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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
Solution
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
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