Practicing Success
If a partner draws a fixed amount of ₹4,000 on the first day of every quarter from the partnership firm, then for what period the interest on total drawings is calculated and how much interest is charged from him if rate of interest is 10% p.a.? |
7.5 months & ₹1,000 7.5 months & ₹867 6.5 months & ₹867 6.5 months & ₹1,000 |
7.5 months & ₹1,000 |
The correct answer is option 1- 7.5 months & ₹1,000. Financial year = 1st April to 31st March. Average period = (time left after 1st drawing + time left after last drawing) / 2 Total amount of drawings = 4,000 x 4 Interest on drawings = Total drawings x (Rate of interest/100) x (Average period/12) |