If a partner withdraws fixed amount in the beginning of each quarter, interest on drawings shall be charged for:
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → 7.5 Months
When the same amount is withdrawn at the beginning of each quarter, the first drawing is outstanding for 12 months and the last for 3 months, so interest is charged on the total drawings for the average period of (12 + 3) ÷ 2 = 7.5 months.
NCERT (2026-27 edition):
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