Question 43 – Calculate interest on drawings of Sanjay @ 10% p.a. for the year ended 31st March 2024, in each of the following alternative cases:
Case 1. If he withdrew Rs 7,500 in the beginning of each quarter.
Case 2. If he withdrew Rs 7,500 at the end of each quarter.
Case 3: If he withdrew Rs 7,500 during the middle of each quarter.
Solution :-
CASE 1: Average month = 12 + 3/2 = 7.5
Interest on Sanjay’s drawings = 7,500 x 4 x 10/100 x 7.5/12
= Rs 1,875
CASE 2: Average month = 9 + 0/2 = 4.5
Interest on Sanjay’s drawings = 7,500 x 4 x 10/100 x 4.5/12
= Rs 1,125
CASE 3: Average month = 10.5 + 1.5/2 = 6
Interest on Sanjay’s drawings = 7,500 x 4 x 10/100 x 6/12
= Rs 1,500