Question:

Daksh and Moksh were partners in a firm. Moksh withdrew a fixed amount at the end of every quarter for the year ended 31st March, 2024. Interest on drawings is charged at 10% p.a. Interest on Moksh’s drawings was charged for _________ months.
 

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For quarterly drawings made at the end of each quarter, use the average period formula to compute interest: \( \frac{9 + 6 + 3 + 0}{4} = 4.5 \) months.
Updated On: Jul 20, 2025
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The Correct Option is C

Solution and Explanation

Moksh withdrew a fixed amount at the end of every quarter.
The quarters in a financial year ending on 31st March are:
1st quarter: June 30
2nd quarter: September 30
3rd quarter: December 31
4th quarter: March 31
Since the drawings are made at the end of each quarter, the average period method is used.
For end-of-quarter withdrawals, the interest is charged for the following average durations:
- 1st quarter (June 30): 9 months
- 2nd quarter (Sept 30): 6 months
- 3rd quarter (Dec 31): 3 months
- 4th quarter (Mar 31): 0 months
Average period = \( \frac{9 + 6 + 3 + 0}{4} = \frac{18}{4} = 4.5 \text{ months} \)
Therefore, interest on drawings is calculated for 4.5 months.
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