Question

5. R. a partner in partnership firm, withdrew 15,000 at the end of each quarter throughout the year
What interest should be charged if deed provides for interest on drawings @ 6% pa
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Answer 1

Given :

Amount of Drawings - 15,000

Rate of interest - 6%

Withdrew at end of each quarter.

( 1 year = 4 quarters)

To Find :

Interest On Drawings

Formula To Find :

${\underline{\sf{ Interest \:on \: Drawings \: = Amount \times \frac{Rate}{100} \times \frac{Average \: Period}{12} }}}$

When Amount is withdrawn at end of Each quarter :

${\underline{\sf{Average \:period \: = \frac{Total \: Periods \: in \: Months - 1}{2} = \frac{4- 1}{2} = 1.5 }}}$

Solution :

Total Amount = 15,000 × 4 = 60,000

$\sf \to \: Amount \times \frac{Rate}{100} \times \frac{Average \: Period}{12}$

$\sf \to \: 60000 \times \frac{6}{100} \times \frac{1.5}{12}$

$\sf\to \: 3600 \times \frac{1.5}{12}$

$\sf \to \: 450$

$\therefore\sf \: Interest \: on \: Drawings \: of \: R \: = ₹450$