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If A and B have capitals of Rs 50,000 and Rs 75,000 respectively and the interest rate is 8%, how much interest on capital will B receive?

Answer and explanation

Correct answer: Rs 6000

Core concept: Interest on capital = Capital × Rate. B's capital is Rs 75,000 and the rate is 8%, so interest = \(75,000\times8\%=75,000\times\dfrac{8}{100}=6,000\) rupees. Option C (Rs 10,000) is incorrect because it equals 8% of the combined capitals (A+B), a common mistake; we must compute interest on B's individual capital. Exam tip: multiply first and then divide by 100; for quick work remember 8% = 2/25.

Related tags

Interest On CapitalPartnership AccountsCapital AccountsNumericalClass 12 AccountancyPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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