Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Accounting for Partnership

Question:

A partner draws ₹7000 per month in the beginning of the year from his partnership firm. Calculate the interest on drawings if rate of interest is charged @15% p.a.?

Options:

₹6845

₹6835

₹6815

₹6825

Correct Answer:

₹6825

Explanation:

Average period for calculating interest on drawings if drawings are made at the beginning of each month of equal amount is 6.5 months [(12+1) months/2].
Total amount of drawings= 7000*12 = ₹ 84000.
Interest on drawings= 84000*15/100*6.5/12 = ₹6825