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Question
Write the word/term/phrase, which can substitute each of the following statements.
"Debit balance of an insolvent Partner's Capital Account".
Options
capital deficiency
Surplus capital
Either capital deficiency or Surplus capital
None of the above
MCQ
Solution
capital deficiency
Explanation:
Capital shortfall is the debit balance of an insolvent partner's capital account. This shortfall will be shared among all solvent partners in their profit-sharing ratio.
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