Practicing Success
Read the following hypothetical text and answer the questions : |
For the amount of loan that Rajesh has agreed to provide, he is entitled to interest thereon at the rate of what percentage? |
6% p.a. 9%p.a. 12%p.a. He is not entitled for any interest on loan because there is no provision of such interest in the partnership deed. |
6% p.a. |
Provisions of Partnership Act 1932 applicable to accounting: If partnership deed is silent in respect of certain aspects, the relevant provisions of the Indian Partnership Act, 1932 become applicable. According to the Partnership Act, the partners share profits equally, no partner is entitled to remuneration, no interest on capital is allowed and no interest on drawings is charged. However, if any partner has given some loan to the firm, he is entitled to interest on such amount @ 6% per annum. |