Question

is interest on drawings for R, if he withdrew Rs6,000 at the beginning of each quarter & interest chargead at 10% p.a. for the year ended 31st March.

• A. Rs. 1,200
• B. Rs. 700
• C. Rs. 900
• D. Rs. 1,500

Answer 1

The correct option is D Rs. 1,500

Interest on drawings
= Rs 6,000 *4 * (Time left after the first drawing + Time left after the last drawing, the whole divided by 2) /12* 10% = Rs. 6,000 *4 * ( $\frac{12+3}{2}$ ) * ( $\frac{1}{12}$ ) * 10%
= Rs. 1,500
Rs. 1,500 is the amount of interest on drawings for R, if he withdrew Rs.6,000 at the beginning of each quarter & interest chargead at 10% p.a. for the year ended 31st March.