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Question

How is interest on drawings calculated, if the drawings are made at regular intervals, as on the 15th day of each month?

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Solution

Drawings can be made by partners in the beginning,middle or end of each month.
If a partner withdraws fixed amount in the middle of each month,interest will be calculated on his total drawings for a period of 6 months.
Here,as the drawings are made at regular intervals as on 15th day of each month,then Interest will be calculated for 6 months.
For Example:- If Rs. 3000 withdrawn in the middle of every month (interest on drawings @10%)
Interest on drawings= 3000*10%*6/12
= 150

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