How will you deal with the following items in the absence of a Partnership Deed:
How will you deal with the following items in the absence of a Partnership Deed:
i) Interest on Capital
ii) Interest on Drawings
iii) Interest on Partner’s Loan to the firm
iv) Share in Profit and Loss
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Answer:-
i) Interest on Capital will not be allowed (paid)
ii) Interest on drawings will not be charged
iii) Interest on loan from a partner will be allowed (Paid) @ 6% p.a.
iv) profit/Loss will be shared equally.
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