Question

Usha and Mohak were partners in a firm. Usha withdrew a fixed amount at the end of every half-year for the year ended 31st March, 2024. Interest on drawings is charged at 9% p.a. Interest on Usha’s drawings will be charged for months.

• A. 3
• B. 6
• C. 9
• D. 12

Hint:

When fixed drawings are made at the end of each half-year, average interest is calculated using the average period formula. The final period is considered 0 months if withdrawal is at year-end.

Answer 1

The Correct Option is A

Step 1: Usha withdrew a fixed amount at the end of every half-year. That means she withdrew twice in the year: 
- First withdrawal at the end of September 2023 
- Second withdrawal at the end of March 2024 
Step 2: Interest on drawings is calculated for the period from date of withdrawal till the end of the financial year. 
Step 3: Interest is charged as follows: 
- For withdrawal on 30^th September, interest = 6 months (Oct to Mar) 
- For withdrawal on 31^st March, interest = 0 months 
Step 4: Average period = \( \frac{6 + 0}{2} = 3 \) months 
Interest on drawings will be charged for 3 months.