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WAEC Financial Accounting 2016 Question 31

Question 31

Partnership Accounts

In the absence of a partnership agreement, additional capital contributions by partners attract interest of

  1. A.5%.
  2. B.10%.
  3. C.12%.
  4. D.15%.
Show the answer and explanation

Answer: A (5%.)

Explanation

Without an agreement, the Partnership Act allows 5% interest on advances a partner makes beyond the agreed capital.