Radha and Rani are partners in a firm. Their capital accounts as on April 01, 2024 showed a balance of Rs. 2,00,000 and Rs. 3,00,000 respectively. On July 01, 2024, Radha introduced additional capital of Rs. 50,000. On October 01, Radha withdrew Rs. 30,000, from her capital. Interest is allowed @ 8% p.a. Calculate the interest payable to Radha on her capital during the financial year 2024–2025.
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → Rs. 17,800
Interest on capital is allowed on each amount for the time it stays in the capital account, so every change in Radha’s capital is charged for its own period. The year runs from April 01, 2024 to March 31, 2025.
Opening capital: Rs. 2,00,000 × 8% = Rs. 16,000 for the whole year
Additional capital: Rs. 50,000 × 8% × 9/12 (July 01 to March 31) = Rs. 3,000, added
Withdrawal: Rs. 30,000 × 8% × 6/12 (October 01 to March 31) = Rs. 1,200, deducted
Interest payable to Radha = Rs. 16,000 + Rs. 3,000 − Rs. 1,200 = Rs. 17,800
Worked on the changing balance instead (Rs. 2,00,000 for 3 months, Rs. 2,50,000 for 3 months, Rs. 2,20,000 for 6 months), the figure is the same Rs. 17,800. Rani’s capital is not needed for this figure.
Note: This question is from NCERT (2026-27). NTA sets numerical questions from NCERT too, so do not ignore NCERT while practising numericals.
NCERT (2026-27 edition):
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