how shall we treat interest on partner's loan in profit and loss appropriation account
Answers
Answered by
1
Partners are entitled to receive interest at an agreed rate of interest on any Loan given by them to the firm. Interest on Loan is a charge against profits so a partner is entitled to receive interest wheather there are profits or not. If there is no agreement regarding the rate of interest, it is taken as 6% p.a.
Similar questions