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3. A trader allows his customers, credit for one week only, beyond which he charges interest@ 12% per annum. D, a customer buys goods as follows: Date of Transaction Amount (Rs) January 2, 2022 60,000 January 28, 2022 55,000 February 17, 2022 70,000 March 4, 2022 42,000 D settles his account d 31 March, 2022. Calculate the amount of interest payable by D, using average due date method. Assume 9th January, 2022 as the base date. ?
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3. A trader allows his customers, credit for one week only, beyond whi...
Calculation of Interest Payable using Average Due Date Method

To calculate the amount of interest payable by customer D using the average due date method, we need to follow the following steps:

Step 1: Determine the due dates for each transaction

- Date of Transaction: January 2, 2022
Due Date: January 9, 2022 (base date + 7 days)

- Date of Transaction: January 28, 2022
Due Date: February 4, 2022 (base date + 7 days)

- Date of Transaction: February 17, 2022
Due Date: February 24, 2022 (base date + 7 days)

- Date of Transaction: March 4, 2022
Due Date: March 11, 2022 (base date + 7 days)

Step 2: Determine the number of days for each transaction

- For the first transaction, the number of days is 7 (January 9, 2022 - January 2, 2022)

- For the second transaction, the number of days is 7 (February 4, 2022 - January 28, 2022)

- For the third transaction, the number of days is 7 (February 24, 2022 - February 17, 2022)

- For the fourth transaction, the number of days is 7 (March 11, 2022 - March 4, 2022)

Step 3: Calculate the weighted average of the due dates

- Weighted average = (Number of days * Amount) / Total amount

- Weighted average = (7 * 60000 + 7 * 55000 + 7 * 70000 + 7 * 42000) / (60000 + 55000 + 70000 + 42000)

- Weighted average = (420000 + 385000 + 490000 + 294000) / 227000

- Weighted average = 1589000 / 227000

- Weighted average = 6.9991

Step 4: Calculate the number of days from the base date to the settlement date

- Settlement date: March 31, 2022

- Number of days = Settlement date - Base date

- Number of days = 31 - 9

- Number of days = 22

Step 5: Calculate the interest payable

- Interest payable = (Weighted average * Rate of interest * Number of days) / 365

- Interest payable = (6.9991 * 12% * 22) / 365

- Interest payable = 0.4163

- Interest payable = Rs. 0.42 (rounded off to the nearest rupee)

Therefore, the amount of interest payable by customer D using the average due date method is Rs. 0.42.
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3. A trader allows his customers, credit for one week only, beyond whi...
Let us take 9th January, 2022 as the base date.

Date of transaction: 2th January, 2022
28th January, 2022
17th February, 2022
4th March, 2022

Due date: 9th January, 2022
4th February, 2022
24th February, 2022
11th March, 2022

Base date: 9th January, 2022

No. of days from 9th January, 2022: 0, 26, 46, 61

Amount(₹) : 60000, 55000, 70000, 42000 = ₹227000

Products (₹) : 0, 1430000, 3220000, 2562000= ₹7212000

Therefore, Average due date= Base date + Total of products/
Total of Amounts
= 9th January, 2022 + ₹7212000/ ₹ 227000
= 9th January, 2022+31.77 days ( 32 days)
= 10th February, 2022

So, Interest payable by D
= ₹ 227000*12%*49/365
= ₹ 3656.88 or ₹ 3657
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3. A trader allows his customers, credit for one week only, beyond which he charges interest@ 12% per annum. D, a customer buys goods as follows: Date of Transaction Amount (Rs) January 2, 2022 60,000 January 28, 2022 55,000 February 17, 2022 70,000 March 4, 2022 42,000 D settles his account d 31 March, 2022. Calculate the amount of interest payable by D, using average due date method. Assume 9th January, 2022 as the base date. ?
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3. A trader allows his customers, credit for one week only, beyond which he charges interest@ 12% per annum. D, a customer buys goods as follows: Date of Transaction Amount (Rs) January 2, 2022 60,000 January 28, 2022 55,000 February 17, 2022 70,000 March 4, 2022 42,000 D settles his account d 31 March, 2022. Calculate the amount of interest payable by D, using average due date method. Assume 9th January, 2022 as the base date. ? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about 3. A trader allows his customers, credit for one week only, beyond which he charges interest@ 12% per annum. D, a customer buys goods as follows: Date of Transaction Amount (Rs) January 2, 2022 60,000 January 28, 2022 55,000 February 17, 2022 70,000 March 4, 2022 42,000 D settles his account d 31 March, 2022. Calculate the amount of interest payable by D, using average due date method. Assume 9th January, 2022 as the base date. ? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for 3. A trader allows his customers, credit for one week only, beyond which he charges interest@ 12% per annum. D, a customer buys goods as follows: Date of Transaction Amount (Rs) January 2, 2022 60,000 January 28, 2022 55,000 February 17, 2022 70,000 March 4, 2022 42,000 D settles his account d 31 March, 2022. Calculate the amount of interest payable by D, using average due date method. Assume 9th January, 2022 as the base date. ?.
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