\(\begin{array}{c|c} & Halima & Ibinabo \\ & N & N \\ \hline \text{Capital accounts 1st Jan, 1992} & 100,000 & 50,000 \\ \text{Current accounts 1st Jan, 199...
Question 1 Report
\(\begin{array}{c|c} & Halima & Ibinabo \\ & N & N \\ \hline \text{Capital accounts 1st Jan, 1992} & 100,000 & 50,000 \\ \text{Current accounts 1st Jan, 1992} & 20,000 & 40,000 \\ \text{Drawing during the year} & 10,000 & 15,000 \\ \text{Annual salaries} & 14,000 & 12,000\end{array}\)
Interest on capital is 10%. The net profit for the year is N60,000. The interest on Halima's capital is
Interest on capital is 10%. The net profit for the year is N60,000. The interest on Halima's capital is
Answer Details
The interest on Halima's capital is calculated by multiplying her capital balance by the interest rate. Halima's capital balance as at 1st January, 1992 is N100,000, and the interest rate is 10%. Therefore, the interest on Halima's capital is:
N100,000 x 10% = N10,000
So the answer is N10,000.
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