During financial year 2021-22, Sahil withdrew ₹30,000 quarterly at the beginning of every quarter. If interest is to be charged at 8% p.a., calculate the amount of interest on drawings :
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → ₹6,000
Total drawings = ₹30,000 × 4 = ₹1,20,000
Withdrawn at the beginning of each quarter, the money is out for 12, 9, 6 and 3 months; average period = (12 + 9 + 6 + 3)/4 = 7.5 months
Interest on drawings = ₹1,20,000 × 8/100 × 7.5/12 = ₹6,000
NCERT (2026-27 edition):
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