Question

Select the most appropriate alternative from those given below and rewrite the statement.

If dates of drawings are not given, interest on drawings is charged for __________________ months.
a) three
b) six
c) nine
d) twelve

Answer 1

If dates of drawings are not given, interest on drawings is charged for six months.
Explanation: When the date of drawings is not given, interest on drawings is charged for an average period of six months. In such cases, it is assumed that a fixed amount is withdrawn as drawings in the middle of every month.