Accountancy Part AAccounting for Partnership

If partnership deed is silent on the profit sharing ratio; interest @…

If partnership deed is silent on the profit sharing ratio; interest @.........per annum is allowed on loans advanced by partners.

Answer & explanation

Correct answer: option 2

The correct answer is Option (2) → 6%

NCERT (2026-27 edition):
Provisions of Partnership Act Relevant for Accounting – “… (d) Interest on Loan: If any partner has advanced loan to the firm for the purpose of business, he/she shall be entitled to get an interest on the loan amount at the rate of 6 per cent per annum.”