Jai and Shyam are partners in a firm with no partnership deed and sharing profits and losses equally. Jai withdrew Rs. 2,000 per month regularly on the first day of every month during the year 2024-2025 for personal expenses. Jai wants interest on drawings to be charged @ 5% p.a. Calculate Jai's interest on drawings.

Zero

Correct answer: Option (3) → Zero

Concept: In the absence of a partnership deed, the Indian Partnership Act, 1932 applies, under which no interest on drawings is to be charged – per Accounting for Partnership: Basic Concepts.

The firm has no partnership deed, so the Act’s provisions govern. One provision states that no interest is to be charged on partners’ drawings when there is no agreement. Jai’s wish to charge interest @ 5% p.a. has no force without a deed, so his interest on drawings = Zero.