alleryStart learning →In the absence of a partnership deed, a partner who works full time in the firm is entitled to:
AA reasonable salary for the work
BA commission on the firm's profit
CNo salary or remuneration at all
DInterest on capital at 6 per cent
Answer & Solution
Correct answer: C. No salary or remuneration at all
1. Where there is no deed, the provisions of the Indian Partnership Act, 1932 apply.
2. Section 13(a) provides that no salary or remuneration is allowed to any partner.
3. This holds however much more work one partner does than the others, which is the point of the textbook's worked illustration on the subject.
4. Interest on capital is likewise not allowed without a deed, so option D fails too.
5. Only interest on a partner's loan survives, at 6 per cent per annum.
_Source: TN HSC Class 12 Accountancy (Samacheer Kalvi, Govt of Tamil Nadu), Unit 3 "Accounts of Partnership Firms - Fundamentals", §3.4_
Keep practising Accounts of Partnership Firms - Fundamentals
Browse all Accounts of Partnership Firms - Fundamentals questions for Tamil Nadu HSC (Class 12), or explore more Accountancy topics.
Related questions
A partner withdraws Rs 4,000 at the end of each quarter. Interest on drawings is 6 per cenA partner withdraws Rs 1,000 at the beginning of every month. Interest on drawings is 5 peWhen computing interest on capital, the balance in a partner's current account is:Under the fluctuating capital method, the share of profit credited to a partner is recordeIn the profit and loss appropriation account, interest on partners' drawings appears on thWhen the date of a drawing is not given, the textbook computes interest for an average perWhich method of computing interest on drawings suits different amounts withdrawn at differA partner withdraws a fixed sum at the END of each quarter. The average period is: