CALCULATION OF INTEREST ON DRAWINGS
PARTNERSHIP ACCOUNTING PARTNERSHIP FUNDAMENTALS CALCULATION OF INTEREST ON DRAWINGS Drawings by a partner may be broadly divided into: 1. Irregular Drawings: It means drawings of the same amount or different amount at irregular intervals . (product method is followed) 2. Regular drawings: It means drawings of the same amount at regular intervals. (Average period method is followed) 1. Product Method : (a) Simple method (b) Product method When unequal amount is withdrawn at different dates or when there are irregular drawings, interest on drawings is calculated with the help of Simple method or Product Method. (a) Simple Method: Under this method, interest on drawings is calculated for the period the ...
Comments
Post a Comment