One partner A draws ₹1,000 every month at the end of the month. If the rate of interest is 5%p.a, what will be the interest on drawings?
Answer & explanation
Correct answer: option 3
The correct answer is option 3- ₹275.
Total drawings = 1,000*12
= 12,000
Interest on drawing = Total drawings x rate of interest x average period/12
= 12,000 x 5/100 x 5.5/12
= 12,000 X 5/100 X 5.5/12
= 275