P = Rs 12,000

After one year the sum accumulated with compound interest

= P (1 +r/100) = 12,000+120 r

Rs 4,000 is returned.

Remaining amount = 8,000 + 120 r at the end of 1st year.

Sum accumulated at the end of 2nd year = (8,000+120r)(1 + r/100)

= 8,000 + 200 r + 1.2 r²

I am not sure if the compound interest for the second year is to be taken as :

8,000 + 200 r + 1.2 r² - (8,000 + 120 r) = 1.2 r² + 80 r

hence, 1.2 r² + 80 r = 920 => 3 r² + 200 r - 2300 = 0

3 r² +230 r - 30 r - 2300 = 0

(3 r + 230) r - 10 (3 r + 230) = 0

** r = 10 % as r is positive we ignore the negative root.**

accumulated sum at the end of 2nd year = 8,000 + 200 * 10 + 1.2 * 10²

** = Rs 10,120 **