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The amounts withdrawn were : ₹12,000 on June 01, 2019, ₹8,000; on August 31, 2019, ₹3,000; on September 30, 2019, ₹7,000, on November 30, 2019, and ₹6,000 on January 31, 2020.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Calculate Interest on drawings for the amount of ₹7,000 withdrawn on November 30, 2019.
Answer & explanation
Correct answer: option 3
The correct answer is option 3- ₹210.
Amount withdrawn on November 30, 2019 = ₹7,000
Interest rate = 9% p.a.
Interest will be calculated from 30 Nov 2019 to 31st March 2020 i.e. 4 months
Interest on drawings = 7,000 x 9/100 x 4/12
= 210