Question

A Trial Balance contains the following information:
I. $15\%$ Bank Loan Rs. 40000
II. Interest paid Rs 4500
Interest debited to P & L A/c will be:

• A. Rs. 6000
• B. Rs. 3000
• C. Rs. 4500
• D. Rs. 1500

Answer 1

The correct option is A Rs. 6000

Interest on bank loan = bank loan x rate/100

= 40,000 x 15/100

= Rs 6,000.

Interest debited to P & L A/c will be 6,000 which is Rs 4,500 paid and Rs-1,500 outstanding.