Question

Rita and Usha were partners in a firm sharing profits and losses in the ratio of 3:5, During the year Usha ‘withdrew ₹ 15,000 at the end of each month. Interest on drawings is to be charged @ 8% p.a. The average period for the calculation of interest on drawings will be ______.

Options

• 4½ months

• 6 months

• 6½ months

• 5½ months

Answer 1

Rita and Usha were partners in a firm sharing profits and losses in the ratio of 3:5, During the year Usha ‘withdrew ₹ 15,000 at the end of each month. Interest on drawings is to be charged @ 8% p.a. The average period for the calculation of interest on drawings will be 5½ months.

Explanation:

Drawings are made at the end of each month.

Average period =`("Time left after drawing" + " Time left after last drawing ")/2  = (11 + 0)/2 `= 5.5 months