Question

Calculate the interest on drawings of Sh. Ganesh @ 9% p.a. for the year ended 31st March, 2024, in each of the following alternative cases:

Case:

1. If he withdrew ₹ 4,000 p.m. in the beginning of every month;
2. If he withdrew ₹ 5,000 p.m. at the end of every month;
3. If he withdrew ₹ 6,000 p.m;
4. If he withdrew ₹ 72,000 during the year;
5. If he withdrew as follows:
   

   	₹
   30th April, 2023	10,000
   1st July, 2023	15,000
   1st Oct., 2023	18,000
   30th Nov., 2023	12,000
   31st March, 2024	20,000

6. If he withdrew ₹ 12,000 in the beginning of each quarter;
7. If he withdrew ₹ 18,000 at the end of each quarter;
8. If he withdrew ₹ 18,000 during the middle of each quarter.

Answer 1

i. ₹ 4,000 p.m. in the beginning of every month:

Total drawings = 4,000 × 12

= ₹ 48,000

Period = 12 months + 1 month

= 13 months

Average period = `13/2`

= 6.5 months

Interest on drawings = `48,000 xx 9/100 xx 6.5/12`

= ₹ 2,340

ii. ₹ 5,000 p.m. at the end of every month:

Total drawings = 5,000 × 12

= ₹ 60,000

Period = 11 months

Average period = `11/2`

= 5.5 months

Interest on drawings = `60,000 xx 9/100 xx 5.5/12`

= ₹ 2,475

iii. ₹ 6,000 p.m. (assumed middle of every month):

Total drawings = 6,000 × 12

= ₹ 72,000

Average period = 6 months

Interest on drawings = `72,000 xx 9/100 xx 6/12`

= ₹ 3,240

iv. ₹ 72,000 withdrawn during the year (evenly):

Total drawings = ₹ 72,000

Average period = 6 months

Interest on drawings = `72,000 xx 9/100 xx 6/12`

= ₹ 3,240

v. Unequal Withdrawals:

Date	Amount	Months	Products
30 April 2023	10,000	11	1,10,000
1 July 2023	15,000	9	1,35,000
1 October, 2023	18,000	6	1,08,000
30 November 2023	12,000	4	48,000
31 March 2024	20,000	0	−
			4,01,000

Interest on drawings = `4,01,000 xx 9/100 xx 1/12`

= ₹ 3,008

vi. ₹ 12,000 in the beginning of each quarter:

Total drawings = 12,000 × 4

= ₹ 48,000

Period = 12 + 3 

= 15 months

Average Period = `15/2`

= 7.5 months

Interest on drawings = `48,000 xx 9/100 xx 7.5/12`

₹ 2,700

vii. ₹ 18,000 at the end of each quarter:

Total drawings = 18,000 × 4

= ₹ 72,000

Period = 9 months

Average Period = `9/2`

= 4.5 months

Interest on drawings = `72,000 xx 9/100 xx 4.5/12`

= ₹ 2,430

viii. ₹ 18,000 during the middle of each quarter:

Total drawings = 18,000 × 4

= ₹ 72,000

Average Period = 6 months

Interest on drawings = `72,000 xx 9/100 xx 6/12`

= ₹ 3,240