Question 31 of 43
Q.
Kumar is a partner in a partnership firm. As per the Partnership deed, interest on drawings is charged at 6% per annum. During the year ended 31st December, 2018 he withdrew as follows :
| Date | ₹ |
|---|---|
| March 1 | 4,000 |
| June 1 | 4,000 |
| September 1 | 4,000 |
| December 1 | 4,000 |
Calculate the amount of interest on drawings.
Puducherry TnboardTamil Nadu HSC (DGE) Commerce Board 2024Subjective· 3mImportance★★★★★
72% · 31/43 Questions
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Start your 14-day free trial to unlock the full solution →By the product method, interest on drawings = Total products (₹88,000) × 6% × 1/12 = ₹440.
The accounting year ends on 31st December 2018, so each drawing earns interest for the number of months from the date of withdrawal to 31 December. This product method is taught in the Tamil Nadu HSC Class-12 Accountancy chapter on Partnership Fundamentals.
| Date of drawing | Amount (₹) | Months up to 31 Dec | Product (₹) |
|---|---|---|---|
| March 1 | 4,000 | 10 | 40,000 |
| June 1 | 4,000 | 7 | 28,000 |
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