On 1st October ,2020 ,Rohan extended loan on his partnership firm (without any agreement ) of ₹10000 . His interest for year ending 31st december , 2020 is:?

Question

Answer

150

Answer

Calculation of Interest on Loan Extended by Rohan on his Partnership Firm

Step 1: Determine the Interest Rate
- As there is no agreement between Rohan and his partnership firm, the interest rate is not predetermined.
- In the absence of an agreement, the interest rate will be governed by the Indian Partnership Act, 1932.
- As per the Act, the interest rate on a partner's loan is 6% per annum.

Step 2: Calculate the Interest for the Year Ending 31st December, 2020
- Rohan extended a loan of ₹10,000 to his partnership firm on 1st October, 2020.
- The loan was outstanding for a period of 3 months (from 1st October to 31st December).
- The interest for the year ending 31st December, 2020 would be calculated as follows:
- Interest = Principal x Rate x Time
- Principal = ₹10,000
- Rate = 6% per annum
- Time = 3/12 years (as the loan was outstanding for 3 months)
- Interest = ₹10,000 x (6/100) x (3/12) = ₹150

Step 3: Record the Interest in the Books of Accounts
- The interest of ₹150 will be recorded as an expense in the books of accounts of the partnership firm.
- Rohan will be credited with the amount of ₹150 in his capital account.

Conclusion: The interest on the loan extended by Rohan on his partnership firm (without any agreement) for the year ending 31st December, 2020 is ₹150.

Similar Class 12 Doubts

A, B and C shared the profit of Rs.75,000 in the ratio of 2:2:1 without providing interest on B's loan of Rs.50,000 given in the beginning of the year. partnership deed is silent on interest on loan and the profit sharing ratio. give necessary adjustment entry.?

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