Partnership

Accounting

Easy

Ravi, one of the partners, provided Rs 1,00,000 loan to the firm. In the absence of partnership deed, interest on partner's loan is allowed @ _____?

6% p.a

5% p.a

✅ Correct Option: 2

When no partnership deed exists, the provisions of the Indian Partnership Act, 1932 apply to the partnership.

According to Section 13(d) of the Partnership Act, 1932, a partner who advances a loan to the firm is entitled to interest at the rate of 6% per annum on such loan amount.

In this case, Ravi has provided a loan of Rs 1,00,000 to the firm. Since there is no partnership deed, he will be allowed interest @ 6% p.a. on this loan amount.

The distinction between "6%" and "6% p.a." is important here. The Act specifically mentions the rate as per annum (yearly), which means the 6% is calculated on an annual basis. If the loan is outstanding for less than a year, interest will be calculated proportionately.

For example, if the loan was given for 6 months, interest = Rs 1,00,000 × 6% × 6/12 = Rs 3,000

The correct answer must include "p.a." to reflect the complete legal provision.

2022: 20 July Shift 1

If average capital employed in a firm is Rs. 15,00,000 and fair rate of return in the same industry was 8%. Goodwill was valued at Rs. 90,000 on the basis of three times of super profit. The Average Profit of the firm is ?

2026: 29 May Shift 1

Under the Fluctuating Capital Method, how many accounts are prepared for all adjustments like undistributed profits, reserves, etc. related to partners?

2026: 29 May Shift 2

Varun and Karan are partners sharing profits and losses in the ratio of 2:1. Their capitals at the end of the financial year 2024-25 were Rs. 1,80,000 and Rs. 90,000. During the year 2024-25, drawings of Varun and Karan were Rs. 30,000 and Rs. 10,000 respectively, which had been duly debited to partner's capital accounts. Profit before charging interest on capital for the year was Rs. 24,000, the same had also been distributed in their profit sharing ratio. Further Karan brought additional capital of Rs. 20,000 on December 31, 2024. Calculate interest on capital for Varun @ 10% p.a. for the year 2024-25.

2026: 13 May Shift 2

When Capital accounts of partners are maintained on the basis of fixed capital method, interest on drawings will be :-

2025: 15 May Shift 2

Match List-I with List-II

If the partnership deed is silent regarding the items provided in List-I

List-I	List-II
(A) Interest on Capital	(I) to be shared equally
(B) Interest on Loan	(II) not charged
(C) Interest on Drawings	(III) not payable
(D) Sharing of Profits	(IV) @6% p.a.

Choose the correct answer from the options given below:

2025: 14 May Shift 2

Partnership comes into existence as a result of an agreement among the partners, that agreement is called......

Ravi, one of the partners, provided Rs 1,00,000 loan to the firm. In the absence of partnership deed, interest on partner's loan is allowed @ _____?

Solution

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