The deed has no provision for interest on drawings. A partner made drawings during the year. What interest on drawings will be charged?

Correct answer: Nil

Direct answer: Option A, nil, is correct. Interest on drawings is not charged automatically merely because a partner withdraws money. It is charged only when the partnership deed, an agreement, or an applicable rule specifically provides for it. Here the deed is silent. Therefore, even though drawings were made throughout the year, the accounting charge is zero. Option A works because silence means no interest on drawings in this context. Option B is wrong because 6% has not been stated anywhere and cannot be assumed. Option C is wrong because the capital-interest rate is not automatically used for drawings. Option D is wrong because the bank rate is also irrelevant unless the deed specifically says so. Do not confuse interest on capital with interest on drawings: the two are separate adjustments. Exam cue: when the deed is silent, do not invent a rate; record nil interest on drawings.