A partner drew Rs 2,500 at the end of each month subject to interest @ 6% p.a. the amount of interest on drawing will be :- (A) Rs 72 (B) Rs 82.50 (C) Rs 90 (d) Rs 93.50
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Given data:
- A partner withdrew Rs 2,500 at the end of every month.
- Interest on drawings was to be charged at 6% p.a.
To find: The interest on drawings.
Answer:
If a person withdraws a fixed amount at the end of every month, the formula below is to be used to calculate the interest on drawings.
Interest on drawings = (Total drawings × Rate) ÷ 100 × (5.5 ÷ 12)
We have,
- total drawings = Rs 2,500 × 12 = Rs 30,000
- rate = 6%
Substituting them in the formula,
Interest on drawings = (Rs 30,000 × 6) ÷ 100 × (5.5 ÷ 12)
Interest on drawings = Rs 825
Therefore, the interest on drawings when a partner withdraws Rs 2,500 at the end of every month at the rate of 6% is Rs 825.
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