How it is 108000 and 84000

Dear Student


In this question, we can see that there are Addition and Withdrawal of Capital on 01-Oct, therefore Interest on capital would be calculated after adjusting the effect of Addition or Withdrawal of capital.
It shall be calculated as follows :
Calculation of Interest on Capital - A
       
Date  Amount   No. of Months to 31-3-18   Interest @ 8% 
1-Apr-17         1,500,000                                                  12                  120,000
1-Oct-17          (300,000)                                                    6                  (12,000)
       
       
Total          1,200,000                    108,000

*Negative amount here represents Withdrawal of Capital.
 
Calculation of Interest on Capital - B
       
Date  Amount   No. of Months to 31-3-18   Interest @ 8% 
1-Apr-17            900,000                                                  12                    72,000
1-Oct-17            300,000                                                    6                    12,000
       
       
Total          1,200,000                      84,000



Regards

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