Read the information carefully and answer the questions.
A partner withdrew money during the year ending March 31, 2020 from his capital account, for his personal use.
The amounts withdrawn were : ₹12,000 on June 01, 2019, ₹8,000; on August 31, 2019, ₹3,000; on September 30, 2019, ₹7,000, on November 30, 2019, and ₹6,000 on January 31, 2020.
Calculate interest on drawings, if the rate of interest is 9 percent per annum.
Calculate Interest on drawings for the amount of ₹3,000 drawn on September 30, 2019.
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Rs. 135
Interest on drawings is charged only for the time the money stayed out of the firm during the year. Rs. 3,000 drawn on September 30, 2019 is out for October to March, that is, 6 months up to March 31, 2020.
Amount = Rs. 3,000; rate = 9% p.a.; period = 6 months
Interest = Rs. 3,000 × 9/100 × 6/12
= Rs. 135
Rs. 270 is the interest for a full year, which would be right only for a drawing made on the first day of the year.
NCERT (2026-27 edition):
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