Question

Calculate Interest on Drawings of Sudhan @ 10 p.a. For the year ended 31st March,

2020 in each of the following alternative cases:

a. If he withdrew Rs. 10,000 in the beginning of each month.

b. If he withdrew Rs. 60,000 at the end of each quarter.

c. If his drawings during the year were Rs. 30,000.​

Answer 1

Answer:

a). Interest on Drawings = Rs 6,500

b). Interest on Drawings = Rs 9,000

c). Interest on Drawings = Rs 1,500

Explanation:

Solution :

★ Formula used :

$\sf{Interest\:on\:Drawings=Total \: Amount \: of \: Drawings \times \: \dfrac{Rate \: of \: Interest}{100} \times \dfrac{Average \: Period}{12}}$

$\rule{300}{1.5}$

a) If he withdrew Rs. 10,000 in the beginning of each month.

In the beginning of each month :

Average Period = 6.5

Interest on Drawing =

$\longrightarrow{\sf{120000 \times \: \: \dfrac{10}{100} \: \times \: \dfrac{6.5}{12}}}$

$\longrightarrow$ 6,500

Interest on Drawings = Rs 6,500

$\rule{300}{1.5}$

b) If he withdrew Rs. 60,000 at the end of each quarter.

At the end of each quarter :

Average Period = 4.5

Interest on Drawing =

$\longrightarrow{\sf{2,40,000 \: \times \: \dfrac{10}{100} \times \: \dfrac{4.5}{12}}}$

$\longrightarrow$ 9,000

Interest on Drawings = Rs 9,000

$\rule{300}{1.5}$

c) If his drawings during the year were Rs. 30,000.

Interest on Drawing =

$\sf{\longrightarrow{30,000 \: \times \: \dfrac{10}{100} \: \times \: \dfrac{6}{12}}}$

$\longrightarrow$ 1,500

Interest on Drawing = Rs 1,500

Therefore,

a). Interest on Drawings = Rs 6,500

b). Interest on Drawings = Rs 9,000

c). Interest on Drawings = Rs 1,500