Which of the following is correct in respect of interest payable to the partners on loans advanced by them to the firm?

The firm will pay interest on the loans extended by partners only when the firm has profit The firm will pay interest on the loans extended by partners only when the deed provides so. Such loans are treated as external liabilities and the firm has to pay interest even if there is no partnership deed and there is no profit in the firm. None of the above

Such loans are treated as external liabilities and the firm has to pay interest even if there is no partnership deed and there is no profit in the firm.

interest payable to the partners on loans advanced by them to the firm are treated as external liabilities and the firm has to pay interest even if there is no partnership deed and there is no profit in the firm.