Assertion (A): Interest on Loan to partner is charged @ 6% p.a., if Partnership Deed does not provide for charging of interest.
Assertion (A): Interest on the Loan to the partner is charged @ 6% p.a., if the Partnership Deed does not provide for the charging of interest.
Reason (R): In the absence of a Partnership Deed, provisions of the Partnership Act, 1932 Apply. Thus, Interest on the Loan to Partner is charged @ 6% p.a. Otherwise, interest is charged at the agreed rate of interest.
In the context of the above two statements, which of the following is correct?
a) Assertion (A) and Reason (R) are correct but the Reason (R) is not the correct explanation of Assertion (A).
b) Both Assertion (a) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
c) Assertion (A) is correct but the Reason (R) is not correct.
d) Both Assertion (A) and Reason (R) are not correct.
Anurag Pathak Changed status to publish April 15, 2023
Ans – d)
The interest on the loan to a partner by the firm is not charged in the absence of a partnership deed.
Thus Assertion (A) is incorrect.
In the absence of a Partnership Deed the interest on a loan to a partner by the firm is not charged.
Thus Reason (R) is also incorrect
Anurag Pathak Changed status to publish April 4, 2023
