Raman withdraws tipis 20000 p.m. on tha last day of every month during the year ended 31/3/2014 calculate interest on droing at the 12%

Question

Answer

𝙏𝙊𝙏𝘼𝙇 𝘿𝙍𝘼𝙒𝙄𝙉𝙂 = 20000 × 12 = 240000.𝙄𝙉𝙏𝙀𝙍𝙀𝙎𝙏 𝙒𝙄𝙇𝙇 𝘽𝙀 𝘾𝙃𝘼𝙍𝙂𝙀𝘿 𝙁𝙊𝙍 5.5 𝙈𝙊𝙉𝙏𝙃𝙎 𝘼𝙎 𝘿𝙍𝘼𝙒𝙄𝙉𝙂𝙎 𝘼𝙍𝙀 𝙈𝘼𝘿𝙀 𝘼𝙏 𝙏𝙃𝙀 𝙀𝙉𝘿 𝙊𝙁 𝙀𝘼𝘾𝙃 𝙈𝙊𝙉𝙏𝙃.______𝙄𝙉𝙏𝙀𝙍𝙀𝙎𝙏 = 240000 × 12 /100 × 5.5 / 12.= 13200.

Answer

Calculating Interest on Withdrawal of Rs. 20,000 per month at 12% for the year ended 31/3/2014

Step 1: Calculate Total Withdrawals

To calculate the total amount withdrawn by Raman during the year, we need to multiply the monthly withdrawal amount with the number of months in the year.

Total Withdrawals = Rs. 20,000 x 12 = Rs. 2,40,000

Step 2: Calculate Average Monthly Withdrawal

The average monthly withdrawal can be calculated by dividing the total withdrawals by the number of months in the year.

Average Monthly Withdrawal = Rs. 2,40,000 / 12 = Rs. 20,000

Step 3: Calculate Interest for Each Month

The interest for each month can be calculated by multiplying the average monthly withdrawal with the interest rate for that month. As Raman withdraws the amount on the last day of each month, we can consider the interest rate for that month only.

Interest for each month = Average Monthly Withdrawal x Interest Rate/12

For example, for the month of April 2013, the interest rate would be 12%/12 = 1%. Therefore, the interest for that month would be Rs. 20,000 x 1% = Rs. 200.

Step 4: Calculate Total Interest for the Year

The total interest for the year can be calculated by adding up the interest for each month.

Total Interest for the Year = Interest for April 2013 + Interest for May 2013 + ... + Interest for March 2014

Total Interest for the Year = Rs. 2,400

Explanation of 12% Interest Rate

The interest rate of 12% is an annual rate. When we divide it by 12, we get the monthly interest rate. This is because interest is calculated on the principal amount, which is the amount withdrawn by Raman each month. As Raman withdraws the same amount every month, we can consider the interest rate for each month only.

Therefore, the interest rate for each month would be (12%/12) = 1%.

By calculating the interest for each month and adding them up, we get the total interest for the year.

It is important to note that the interest rate may vary depending on the bank or financial institution. Therefore, it is important to check the interest rate before making any investments or withdrawals.

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