Question

Calculate Interest on drawings of Ram @ 10%p.a. for the year ended 31st March,2014,if he withdrews rs.2000 per month

CASE 1..IF HE WITHDERW DURING THE MIDDLE OF MONTG

CASE 2..AT THE END OF EVERY MONTH

CASE 3..IN THE BEGINNING OF EVERY MONTH⁸​

Answer 1

Interest on drawings of Ram :

CASE 1 = Rs. 1,200

CASE 2 = Rs. 1,100

CASE 3 = Rs. 1,300

Explanation:

Solution :

Total amount withdrawn = 2,000 × 12 = Rs. 24,000

Total amount withdrawn = Rs. 24,000

Interest rate = 10 % p.a.

★ Formula used:

Interest on drawings =

$\sf{Total \: amount \: of \: drawings \: \times \: \dfrac{Rate \: of \: interest}{100} \: \times \: \dfrac{Average \: period}{12}}$

CASE 1 :

IF HE WITHDERW DURING THE MIDDLE OF MONTH

If drawings are made in the middle of every month :

Average period = 6

⇒ $24000 \: \times \: \dfrac{10}{100} \: \times \: \dfrac{6}{12}$

⇒$1200$

Interest on drawings = Rs. 1,200

___________________________

CASE 2 :

AT THE END OF EVERY MONTH

If drawings are made at the end of every month :

Average period = 5.5

⇒ $24000 \: \times \: \dfrac{10}{100} \: \times \dfrac{5.5}{12}$

⇒ $1100$

Interest on drawings = Rs. 1,100

___________________________

CASE 3 :

IN THE BEGINNING OF EVERY MONTH

If drawings are made at the beginning of every month :

Average period = 6.5

⇒ $24000 \: \times \: \dfrac{10}{100} \: \times \: \dfrac{6.5}{12}$

⇒$1300$

Interest on drawings = Rs. 1,300

Therefore,

Interest on drawings of Ram :

CASE 1 = Rs. 1,200

CASE 2 = Rs. 1,100

CASE 3 = Rs. 1,300

Answer 2

Answer:

Interest of drawings for three cases are:

Case-1: Rs. 1,200

Case-2: Rs. 1,100

Case-3: Rs. 1300

Solution:

Given that, Ram withdraws Rs.2000 per month. So, total drawing will be:

Total Drawing = 2000×12 = 24,000.

Also, the intereste rate is given as 10% per annum.

For three cases, the formula used is same:

Interest of Drawings = Total drawing×(Rate of interest/100)×(Average period/12)

Let's solve each case one by one!

Case 1: If Ram withdraws Rs. 2,000 during the middle of the month, then the average period is:

⇒ Average period = (11.5+0.5)/2

⇒ Average Period = 12/2

⇒ Average Period = 6

⇒Interest of Drawings = 24000×(10/100)×(6/12)

⇒Interest of Drawings = 24000×1/10×1/2

⇒Interest of Drawings = 12,000/10

⇒Interest of Drawings = Rs. 1,200

Case 2: If Ram withdraws Rs. 2,000 at the end of every month, the average period will be:

⇒ Average period = (11+0)/2

⇒ Average Period = 11/2

⇒ Average Period = 5.5

⇒Interest of Drawings = 24000×(10/100)×(5.5/12)

⇒Interest of Drawings = 200×5.5

⇒Interest of Drawings = Rs. 1,100

Case 3: If Ram withdraws Rs. 2,000 at the beginning of every month, the average period will be:

⇒ Average period = (12+1)/2

⇒ Average Period = 13/2

⇒ Average Period = 6.5

⇒Interest of Drawings = 24000×(10/100)×(6.5/12)

⇒Interest of Drawings = 200×6.5

⇒Interest of Drawings = Rs. 1,300

Hence, Solved!!