Target Exam

CUET

Subject

-- Accountancy Part A

Chapter

Accounting for Partnership

Question:

Based on following answer the question:

Chirag and Jyoti are two partners in a firm sharing profits and losses equally. Chirag withdrew money for his personal use. As per partnership deed rate of interest on drawings is 9% per annum.

If he withdrew Rs.4000 per month at the beginning of every month then Average period for interest charged on Drawing will be:

Options:

6.5 months

6 months

5.5 months

4.5 months

Correct Answer:

6.5 months

Explanation:

The correct answer is Option (1) → 6.5 months.

When the amount is withdrawn at the beginning of each month. 
Ist drawing = 1st April, so months left after it are 12.
Last drawing = 1st March, so months left after it are 1.
Average Period = (No. of months left after 1 drawings + No. of months left after last drawings)/2
                         = (12+1)/ 2
                         = 6.5 months