When a Partnership Is Insolvent and a Partner Has a Deficit

question 15

Multiple Choice

When a partnership is insolvent and a partner has a deficit capital account balance, that partner is legally required to:

• A) Declare personal bankruptcy.
• B) Initiate legal proceedings against the partnership.
• C) Contribute cash to the partnership.
• D) Deliver a note payable to the partnership with specific payment terms.
• E) None of these answer choices are correct. The partner has no legal responsibility to cover the capital deficit balance.

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Definitions:

Peripheral Route

A method of persuasion that relies on superficial cues rather than the strength of arguments, often influencing attitudes without deep processing.

Inoculation Theory

A social psychological and communication theory that explains how attitudes and beliefs can be made more resistant to change by exposing them to counter-arguments.

Novel Arguments

Innovative or unique lines of reasoning or persuasion not previously presented or considered.

Persuasion

The act or process of influencing someone's beliefs, attitudes, intentions, motivations, or behaviors through communication.