Partners interest on capital
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
23 August 2011
Dear Expert,
Interest rate on capital to partners is 12% in partnership deed.
Whether it is calculated on the closing balance of capital or opening balance?
Our client has calculated on day basis.
Interest rate on capital to partners is 12% in partnership deed.
Whether it is calculated on the closing balance of capital or opening balance?
Our client has calculated on day basis.
23 August 2011
It is need to be calculated on proportionate with the balances
suppose year starting Rs.10000
After 4 months again partner bringing Rs.5000 means
10000 for 4 months
Rs.15000 for balance 8 months
suppose year starting Rs.10000
After 4 months again partner bringing Rs.5000 means
10000 for 4 months
Rs.15000 for balance 8 months
23 August 2011
It depends on the wordings used in the partnership deed. In the absence of specific method, interest has to be calculated on the daily balance outstanding in the account.
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