Question

Ayan, Azan and Aqib are partners carrying on a furniture business.

Ayan withdrew ₹ 5,000 at the end of each month.

Azan withdrew ₹ 10,000 at end of each quarter.

Aqib withdrew ₹ 40,000 at the end of each month for the last six months of the year. The partnership deed provides for interest on drawings @ 12% p.a. The interest on drawing charged from Ayan, Azan and Aqib at the end of the year will be:

Options

• Ayan – ₹ 3,300, Azan – ₹ 1,800, Aqib – ₹ 6,000

• Ayan – ₹ 3,900, Azan – ₹ 3,000, Aqib – ₹ 7,200

• Ayan – ₹ 3,000, Azan – ₹ 2,400, Aqib – ₹14,400

• Ayan – ₹ 600, Azan – ₹ 400, Aqib – ₹ 2,400

Answer 1

Ayan – ₹ 3,300, Azan – ₹ 1,800, Aqib – ₹ 6,000

Explanation:

1. Ayan withdrew ₹ 5,000 at the end of each month.

Total drawings = 5,000 × 12

= ₹ 60,000

When withdrawals are made at the end of each month, the average period is 5.5 months.

Interest on drawings = `60,000 xx 12/100 xx 5.5/12`

= ₹ 3,300

2. Azan withdrew ₹ 10,000 at end of each quarter.

Total drawings = 10,000 × 4

= ₹ 40,000

When withdrawals are made at the end of each quarter, the average period is 4.5 months.

Interest on drawings = `40,000 xx 12/100 xx 4.5/12`

= ₹ 1,800

3. Aqib withdrew ₹ 40,000 at the end of each month for the last six months of the year.

Total drawings = 40,000 × 6

= ₹ 2,40,000

When withdrawals are made at the end of each month for the last 6 months, the average period is 2.5 months.

Interest on drawings = `2,40,000 xx 12/100 xx 2.5/12`

= ₹ 6,000