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When an asset is taken over by a partner, why is his capital account debited? - Accounts

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Question

When an asset is taken over by a partner, why is his capital account debited?

Very Short Answer
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Solution

When a partner takes over an asset, their capital account is debited because their entitlement from the firm decreases by the value of the asset received.

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Chapter 5: Dissolution of Partnership Firm - SHORT ANSWER QUESTIONS [Page 5.74]

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D. K. Goel Accountancy Volume 1 and 2 [English] Class 12 ISC
Chapter 5 Dissolution of Partnership Firm
SHORT ANSWER QUESTIONS | Q 10. | Page 5.74
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