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In which situation will the amount transferred to loan account be less than the retiring partner's final capital balance?

Answer and explanation

Correct answer: When part of final capital balance is paid immediately

Only the unpaid part after immediate payment becomes loan. Exam tip: deduct immediate settlement from capital balance.

Related tags

Capital BalanceImmediate PaymentLoan TransferPartner's Loan AccountPartner S Loan AccountReconstitution Retirement Or Death Of A PartnerAccountancyClass 12 Mcq

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