Which of the following rules is applicable in the absence of a partnership agreement? Interest is payable
On drawings at the rate of 5% per annum
On any contribution in excess of agreed capital at 5% per annum
At 5% per annum on the current account balances
On agreed capital contributed at 5% per annum
Correct answer is B
If no specific agreement is made by the partners, 5% interest a year on loans made by partners in excess of the agreed capitals.