Question

Santhosh 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	₹
February 1	2,000
May 1	10,000
July 1	4,000
October 1	6,000

Calculate the amount of interest on drawings.

Answer 1

Interest on Drawings = Amount × Rate of Interest × Period

Feb 1 = `2,000 xx 6/100 xx 11/12` = ₹ 110

May 1 = `10,000 xx 6/100 xx 8/12` = ₹ 400

July 1 = `4,000 xx 6/100 xx 6/12` = ₹ 120

Oct 1 = `6,000 xx 6/100 xx 3/12` = ₹ 90

Interest on Drawings = 110 + 400 + 120 + 90 = ₹ 720