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%.
If partnership deed is silent on the profit sharing ratio; interest @ 6% per annum is allowed on loans advanced by partners.
If a partner has provided a loan to the partnership for business purposes, they are entitled to receive interest on the loan amount at a rate of 6 percent per annum in the absence of any agreement.