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Partners are suppose to pay interest on ...

Partners are suppose to pay interest on drawing only when ….. By the ……

A

Provided, Agreement

B

Permitted, Investors

C

Agreed, Partners

D

A' & 'C' above

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Interest On Drawings

For the firm interest on drawings is

Knowledge Check

  • Where will you record interest on drawing :

    A
    Debit Side of Profit & Loss Appropriation Account
    B
    Credit Side of Profit & Loss Appropriation Account
    C
    Credit Side of Profit & Loss Account
    D
    Debit Side of Profit & Loss Account

  • How does every bank pay interest on savings ?

    A
    (a)Daily
    B
    (b)Weekly
    C
    (c)Fortnightly
    D
    (d)Monthly

    • Similar Questions

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    (i)Current Accounts arer maintained in case of fluctuatig capital system. (ii) Partners are entitled to get interest @6% p.a. on the loan given to the firm , if Partnership Deed is silent on the issue. (iii) At least two persons are necessary to form a partnership. (iv) In the absence of a agreement , profits and losses are distributed among the partners equally. (v) a partner who devotes more time to a business than others is entitled to get a salary . (vi) A partner who has invested more capital in the firm is entitled to get interest on the difference in capital amount. (vii) When a partner draws a fixed sum at the end month for 12 months, interest on total drawings will be equal to interest of 5^(1//2) months at an agreed rete per annum. (viii) When a partner draws a fixed sum in the middle of each month for 12 months , interest on total drawings will be equal to intersts of 6 month at an agreed rate per annum. (ix) If the Partnership Deed is silent , interest @6% would be charged on the drawings made by the partner . (x) Interest on partner 's loan is to be given @10% p.a. if silent about the rate (xi) Valid partnership can formulated even without a written agreement between the partner. (xii) Partners are mutual agents of each other so far as the business of firm is concerned.

    State whether the following statements are True or False (i) Current Accounts are maintained in case of fluctuating capital system. (ii) Partners are entitled to get interest @ 6% p.a. on the loan given to the firm, if Partnership Deep is silent on the issue. (iii) At least two person are necessary to form a partnership (iv) In the absence of an agreement, profits and losses are distributed among the partners equally. (v) A partner who devotes more time to a business than others is entitled to get a salary. (vi) A partner who has invested more capital in the firm is entitled to get interest on the difference in capital amount. (vii) When a partner draws a fixed sum in the middle of each month for 12 months, interest on total drawings will be equal to interest of 6 months at an agreed rate per annum. (ix) If the Partnership Deep is silent, interest @ 6% would be charged (x) Interest on partner's loan is to be given @ 10% p.a. if the deed is silent about the rate. (xi) Valid partnership can be formulated even without a written agreement between the partners. (xii) Partners are mutual agents of each other so far as the business of the firm is concerned.

    Brij and mohan are partners in a firm they withdrew Rs. 48,000 and Rs. 36,000 respectively during the year evenly in the midle of every month Accoding to the partnership agreement interest on drawings is to be charged @10% p.a Calulate interest on drawings of the partners using the appropritate formula .

    the partnership Deed does not provide for charging interest on drawing therefore , the provisions of the indian partnersip Act 1932 apply whereby interest cannot be charged . The partners desire to chage interest thereon can you suggest what steps should they take so that firm can chage interest on on drawings ?

    In a partnership firm, a partner withdraw Rs.5,000 per month on the first day of every month during the year for personal expenses. If interest on drawings is charged @6% p.a. the interest charged will be :

    Amit and Bhola are partners in a firm. They share profits in the ratio of 3:2. As per their partnership agreement, interest on drawings is to be charged @ 10% p.a. Their drawings during 2017 were Rs. 24,000 and Rs. 16,000, respectively. Calculate interest on drawings based on the assumption that the amounts were withdrawn evenly, throughout the year.

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