Question

Q. 27 (C). A, B and C are partners in a firm. For six months ending 31st March,
2018:
A drew regularly 15,000 in the beginning of every month. B drew regularly
20,000 at the end of every month and C drew regularly 25,000 in the middle of
every month. calculate intrest on drawing @ 10%p.a for 6 month ending 31 March 2018​

Answer 1

SOLUTION :

❒ Given :-

• A withdrew regularly in the beginning of every month for six months = Rs. 15000

• B withdrew regularly at the end of every month for six months = Rs. 20000

• C withdrew regularly in the middle of every month for six months = Rs. 25000

• Rate of Interest on Drawings = 10% p.a.

❒ To calculate :-

• Interest on Drawings for A = ?

• Interest on Drawings for B = ?

• Interest on Drawings for C = ?

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❒ Calculation of Interest on Drawings for A :-

[If fixed amount are withdrawn at the beginning of every month throughout the year, interest on the total amount of drawings is calculated for the average period; i.e., for 6 ½ months ]

Here,

• Amount of Drawings = Rs. 15000

• Period of time = 6 months

• Total amount of Drawings = (Rs. 15000 × 6) = Rs. 90000

• Rate of Interest = 10% p.a.

As withdrawn is made in the beginning of every month for 6 months, interest on Drawings will be calculated for 3½ months or 3.5 months.

• ★ Interest on Drawings = Rs. 90000 × 10% × 3.5 months

➨ Interest on Drawings = Rs. ( 90000 × $\sf{\dfrac{10}{100}}$ × $\sf{\dfrac{3.5}{12}}$ )

➨ Interest on Drawings = Rs. ( 90000 × $\sf{\dfrac{1}{10}}$ × $\sf{\dfrac{3.5}{12}}$ )

∴ Interest on Drawings = Rs. 2625 ✪

• ✎ Hence, the amount of interest on drawings if A withdrawn Rs. 15000 in the beginning of every month for six months is Rs. 2625.

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❒ Calculation of Interest on Drawings for B :-

[If fixed amount are withdrawn at the end of every month throughout the year, interest on the total amount of drawings is calculated for the average period; i.e., for 5 ½ months ]

Here,

• Amount of Drawings = Rs. 20000

• Period of time = 6 months

• Total amount of Drawings = (Rs. 20000 × 6) = Rs. 120000

• Rate of Interest = 10% p.a.

As withdrawn is made at the end of every month for 6 months, interest on Drawings will be calculated for 2½ months or 2.5 months.

• ★ Interest on Drawings = Rs. 120000 × 10% × 2.5 months

➨ Interest on Drawings = Rs. ( 120000 × $\sf{\dfrac{10}{100}}$ × $\sf{\dfrac{2.5}{12}}$ )

➨ Interest on Drawings = Rs. ( 120000 × $\sf{\dfrac{1}{10}}$ × $\sf{\dfrac{2.5}{12}}$ )

∴ Interest on Drawings = Rs. 2500 ✪

• ✎ Hence, the amount of interest on drawings if B withdrawn Rs. 20000 at the end of every month for six months is Rs. 2500.

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❒ Calculation of Interest on Drawings for C :-

[If fixed amount are withdrawn on the middle of every month throughout the year, interest on the total amount of drawings is calculated for the average period; i.e., for 6 months ]

Here,

• Amount of Drawings = Rs. 25000

• Period of time = 6 months

• Total amount of Drawings = (Rs. 25000 × 6) = Rs. 150000

• Rate of Interest = 10% p.a.

As withdrawn is made in the beginning of every month for 6 months, interest on Drawings will be calculated for 3 months.

• ★ Interest on Drawings = Rs. 150000 × 10% × 3 months

➨ Interest on Drawings = Rs. ( 150000 × $\sf{\dfrac{10}{100}}$ × $\sf{\dfrac{3}{12}}$ )

➨ Interest on Drawings = Rs. ( 150000 × $\sf{\dfrac{1}{10}}$ × $\sf{\dfrac{1}{4}}$ )

∴ Interest on Drawings = Rs. 3750 ✪

• ✎ Hence, the amount of interest on drawings if C withdrawn Rs. 25000 at the beginning of every month throughout the year is Rs. 3750.