Question

Menon and Thomas are partners in a firm. They share profits equally. Their monthly drawings are Rs 2,000 each. Interest on drawings is to be charged @ 10% p.a. Calculate interest on Menon’s drawings for the year 2006, assuming that money is withdrawn: (i) in the beginning of every month, (ii) in the middle of every month, and (iii) at the end of every month.

Answer 1

Answer:

Explanation:

(i) If they withdraw money in the beginning of each month

Interest of drawings = Total drawings × Rate × 13/ 2 × 12

Menon = 24,000 × 10/100 × 13/ 2 × 12

= 1,300

Thomas = 24,000 × 10/100 × 13/ 2 × 12

= 1,300

(ii)   If they withdraw in the middle of every month

Interest on Drawings = Total drawings × 10/100  × 6/12

Menon = 24,000 × 10/100 × 6/12

= 1,200

Thomas = 24,000 × 10/100 × 6/12

= 1,200

(iii)  If they withdraw at the end of every month.

Interest on drawings = Total drawings × r% × 11/ 2 × 12

Menon = 24,000 × 10/100 × 11/ 2 × 12

= 1,100

Thomas = 24,000 × 10/100 × 11/ 2 × 12

= 1,100