In the Liquidation Process If a Capital Account Shows a Deficiency

question 34

Multiple Choice

In the liquidation process if a capital account shows a deficiency

• A) the partner with a deficiency has an obligation to the partnership for the amount of the deficiency.
• B) it may be written off to a "Loss" account.
• C) it is disregarded until after the partnership books are closed.
• D) it can be written off to a "Gain" account.

---

Definitions:

Unqualified Endorsements

An endorsement on a negotiable instrument, such as a check, without any limitations, allowing for the transfer of rights to another party.

Special

Distinguished or different from what is ordinary or usual, often implying superiority or a specific purpose.

Bearer Paper

A negotiable instrument or document of title that confers entitlement to the holder or bearer, with no named payee.

Endorsement

The act of signing one's name on the back of a check or other negotiable instrument, or a public declaration of support for a person, product, or service.