When a Partner Makes an Advance or Loan to the Partnership

Multiple Choice

When a partner makes an advance or loan to the partnership, how many of these statements are true?
He/she is entitled to interest at the rate of 7% p.a. unless there is an agreement to the contrary.
The amount loaned is added to the partners equity account balance.
Interest on the loan is regarded as an expense of the partnership and appears in the income statement.

A) 0
B) 1
C) 2
D) 3