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A retiring partner’s loan account has a balance of ₹3,20,000. If 10% interest for one year is added to this balance, what will be the new balance of the loan account?

Answer and explanation

Correct answer: ₹3,52,000

Interest = ₹3,20,000 × 10/100 = ₹32,000. Therefore, the new loan account balance = ₹3,20,000 + ₹32,000 = ₹3,52,000, so option B is correct. Option A results from adding an incorrect interest amount. Exam tip: calculate the interest first and then add it to the opening balance.

Related tags

Partner Loan AccountRetirement Of PartnerInterest CalculationReconstitution Of PartnershipAccountancy Class 12Partner's Loan AccountPartner S Loan AccountReconstitution Retirement Or Death Of A Partner

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