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A retiring partner’s loan account has a balance of ₹1,80,000. What will be the interest for one year at the rate of 13% per annum?

Answer and explanation

Correct answer: ₹23,400

Interest for one year on the partner’s loan = Principal × Rate ÷ 100 = ₹1,80,000 × 13 ÷ 100 = ₹23,400. Therefore, option C is correct. Option B is incorrect because ₹22,400 is not 13% of ₹1,80,000. For such questions, multiply the principal by the annual rate and divide by 100.

Related tags

Partner Loan AccountInterest CalculationRetirement Of PartnerPartnership AccountingPartner's Loan AccountPartner S Loan AccountReconstitution Retirement Or Death Of A PartnerAccountancy

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