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WAEC Financial Accounting 2025 Question 19

Question 19

Partnership Accounts

In the absence of a partnership agreement, loan granted to the business by a partner would attract

  1. A.zero interest per annum
  2. B.interest at 10% per annum
  3. C.interest at 5% per annum
  4. D.interest at 7% per annum
Show the answer and explanation

Answer: C (interest at 5% per annum)

Explanation

Under the Partnership Act 1890, a partner's loan earns 5% interest a year when there is no agreement.