A Partner Can Withdraw from a Partnership By

question 56

Multiple Choice

A partner can withdraw from a partnership by:

• A) Receiving cash or other assets of the partnership greater than the amount of his/her capital account.
• B) Receiving cash or other assets of the partnership equal to the amount of his/her capital account.
• C) Selling his/her interest to another person who pays for it with non-cash assets.
• D) Selling his/her interest to another person who pays for it in cash.
• E) All of these answers are correct.

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Definitions:

Profit Share

A portion of a company's profits allocated to its employees, shareholders, or partners, often as an incentive or reward.

Capital Balances

Capital balances represent the amount of capital a business or individual has invested or retained in a company, often reflecting ownership equity.

Net Income

The total earnings of a company after subtracting all expenses, taxes, and costs from total revenue.

Income Distribution

The allocation of earned income or revenue to various stakeholders, such as dividends to shareholders or wages to employees.