Question

Opening capital of Keshav was:

• A. Rs.35,000
• B. Rs.39,000
• C. Rs.43,000
• D. Rs.52,000

Hint:

When calculating opening capital, add back drawings and subtract the profit earned during the year from the closing capital.

Answer 1

The Correct Option is C

Keshav's closing capital is Rs.55,000. Opening capital is determined by adjusting for yearly profit and drawings made at the start of each quarter.
Step 1: Determine total drawings:
Quarterly drawings at the start of each quarter amount to Rs.1,500. The total annual drawings are: \[ Rs.1,500 \times 4 = Rs.6,000. \] 
Step 2: Account for profit:
The annual profit is Rs.15,000. 
Step 3: Calculate opening capital:
The formula for opening capital is: \[ {Opening Capital} = {Closing Capital} - {Profit} + {Drawings}. \] Applying the figures: \[ {Opening Capital} = Rs.55,000 - Rs.15,000 + Rs.6,000 = Rs.43,000. \] 
Conclusion:
Keshav's opening capital was \( Rs.43,000 \).