The Right of Offset Doctrine

question 57

Multiple Choice

The right of offset doctrine

• A)sets aside the ranking that partnership loans have higher legal priority than capital to facilitate the liquidation process.
• B)enables the partnership fiduciary to offset the deficit capital balance of one partner with the surplus capital balance of another.
• C)allows individual partner creditors to offset their claims against that partner's capital balance.
• D)dictates that liquidation expenses must be offset against the partners' capital balances prior to distributions taking place.

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