Rs 50,000 were received in advance for the second and final call along with the first call. The second and fin

Question

Rs 50,000 were received in advance for the second and final call along with the first call. The second and final call was due after two months from the first call. Table F (formerly Table A) provides for interest on calls in advance at a rate not exceeding _____ per annum, and the calculated interes

Accepted Answer

According to Table F of Schedule I of the Companies Act, 2013, the maximum permissible rate of interest payable on calls-in-advance is

12% p.a.

Let us compute the absolute interest value based on the parameters provided:Advance Principal (

P

) =

Rs 50, 000

Annualized Rate (

R

) =

12%

Time Gap (

T

) =

2 months = \frac{2}{12} year

Using the simple interest formula:

Interest = P \times \frac{R}{100} \times T

Interest = 50, 000 \times \frac{12}{100} \times \frac{2}{12}

Interest = 50, 000 \times 0.12 \times \frac{1}{6} = 50, 000 \times 0.02 = Rs 1, 000

Thus, the parameters match

12%

and

Rs 1, 000

.

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