Question

In case the deed provides for payment of interest on capital but does not specify the rate, the interest will be paid at which rate per annum?

Options

• 6 per cent per annum

• 8 per cent per annum

• 9 per cent per annum

• 12 per cent per annum

Answer 1

6 per cent per annum

Explanation:

If the deed allows for the payment of interest on capital but does not specify the rate, the interest will be paid at 6% per year. Furthermore, interest is only paid out of the company's profits, not if the company loses money during the period.