Question

On 1st January 2024, Ravi, Mohan and Shreya entered into a partnership with fixed capitals of ₹ 3,00,000, ₹ 2,00,000 and ₹ 1,00,000, respectively. Their partnership deed provided for the following: Salary to Ravi @ ₹ 20,000 per month. Rent to Mohan for the use of his property for business purpose @ ₹ 5,000 per month. The manager is to be allowed a commission of 10% of the profit of the firm. Profit for the year ended 31st March, 2024, before providing for the above adjustments, amounted to ₹ 3,45,000.

Interest on capital allowed to partners will be:

Options

• @ 12% p.a.

• @ 6% p.a.

• @ 10% p.a.

• No interest will be allowed.

Answer 1

No interest will be allowed.