Question

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 31^st 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.

Answer 1

Interest on Drawings = Amount × Rate of Interest × Period

March 1 = `4,000 xx 6/100 xx 10/12` = ₹ 200

June 1 = `4,000 xx 6/100 xx 7/12` ₹ 140

September 1 = `4,000 xx 6/100 xx 4/12` = ₹ 80

December 1 = `4,000 xx 6/100 xx 1/12` ₹ 20

Interest on Drawings = 200 + 140 + 80 + 20 = ₹  440