Question 29 Chapter 2 of +2-Part-1
29. (Interest on Drawings/Drawings at beginning, middle and end of each month) A and B are partners in a firm. Their monthly drawings are Rs.2,000 each. Interest on drawings is to be charged @10% each.
Calculate interest on A’s drawings for the year 2016-17 assuming drawings are made
1.In the beginning of every month
2.In the middle of every month
3. At the end of every month.
The solution of Question 29 Chapter 2 of +2 Part-1: –
Calculation of interest on partner’s Drawings
If partners withdrawal the same amount of drawing on a regular basis then we can calculate the interest on drawing with help of following formula: –
Interest on Drawing = Total Drawings X Rate of Interest X Period/12 Months
Rate of Interest = 10%
Period = the period/time will be calculated with the help of following formula: –
Period | = | Time left after 1st withdrawal | + | Time left after Last withdrawal |
2 |
1. Calculation of interest on Muthu’s Drawings:
A’s withdrawal at the beginning of every month = 2,000 p.m. Therefore, total drawings of the year= Rs.24,000.
It means 1st withdrawal has made on 01-04-2016
So, Time left from 1-4-2016 to 1-3-17 is 12 Months
And last withdrawal has made on 1-3-2017
So, Time left from 1-3-2017 to 31-3-2017 is 1 month.
Now, put this time period in the formula
Period | = | 12 | + | 1 |
2 |
Period | = | 13 | ||
2 |
Period | = | 6.5 |
Total Drawings = 24,000
Interest on Drawing | = | 24,000 | X | 10 | X | 6.5 |
100 | 12 | |||||
Interest on Drawing | = | 1300/- |
2. Drawings in the middle of every month
A’s withdrawal at the middle of every month = 2,000 p.m. Therefore, total drawings of the year= Rs.24,000.
It means 1st withdrawal has made on 15-04-2016
So, Time left from 15-4-2016 to 1-3-17 is 11 months and 15 days. = 11.5 months
And last withdrawal has made on 15-3-2017
So, Time left from 15-3-2017 to 31-3-2017 is 15 days = 0.5 month
Now, put this time period in the formula:
Period | = | 11.5 | + | 0.5 |
2 |
Period | = | 12 | ||
2 |
Period | = | 6 |
Total Drawings = 24,000
Interest on Drawing | = | 24,000 | X | 6 | X | 6 |
100 | 12 | |||||
Interest on Drawing | = | 1200/- |
3. Drawings at the end of every month
A’s withdrawal at the end of every month = 2,000 p.m. Therefore, total drawings of the year= Rs.24,000.
It means 1st withdrawal has made on 31-04-2016
So, Time left from 31-4-2016 to 31-3-17 in 11 Months
And last withdrawal has made on 1-3-2017
So, Time left from 31-3-2017 to 31-3-2017 is 0 months.
Period | = | 11.5 | + | 0 |
2 |
Period | = | 11 | ||
2 |
Period | = | 5 |
Interest on Drawing | = | 24,000 | X | 6 | X | 5.5 |
100 | 12 | |||||
Interest on Drawing | = | 1,100/- |
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Also, Check out the solved question of previous Chapters: –
Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution
- Chapter No. 1 – Accounting Not for Profit Organisations
- Chapter No. 2 – Partnership Accounts – I (Introduction)
- Chapter No. 3 – Partnership Accounts – II (Goodwill: Nature and Valuation)
- Chapter No. 4 – Partnership Accounts – III (Reconstitution of Partnership)
- Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)
- Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)
- Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)
- Chapter No. 8 – Company Accounts (Share Capital)
- Chapter No. 9 – Company Accounts (Issue of Debentures)
- Chapter No. 10 – Company Accounts (Redemption of Debentures)
Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution
- Chapter No. 1 – Financial Statements of a Company
- Chapter No. 2 – Financial Statement Analysis
- Chapter No. 3 – Tools of Financial Statement Analysis- Comparative and Common Size
- Chapter No. 4 – Ratio Analysis
- Chapter No. 5 – Cash Flow Statement
Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

how can the time left is calculated till 31 march when the year is ending on 31 december ?????
From where you read 31 dec?