Interest will not be charged on partner's drawings
Interest will be charged @ 5% p.a. on partner's drawings
Interest will be charged @ 6% p.a. on partner's drawings
Interest will be charged @ 12% p.a. on partner's drawings
Answer is Right!
Answer is Wrong!
The correct answer is: A. Interest will not be charged on partner’s drawings.
In the absence of a partnership deed, the law does not specify whether interest should be charged on partner’s drawings. Therefore, it is up to the partners to decide whether or not to charge interest. If they do not agree on whether or not to charge interest, then the court may decide on their behalf.
The other options are incorrect because they specify a rate of interest that is not mandated by law.