Liquidation of a partnership often includes sale of assets at a loss.When the losses occur,each partner capital account is debited based on the profit and loss distribution ratio set out in the partnership agreement.

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This statement is true. When assets are sold at a loss during liquidation of a partnership, each partner's capital account is debited based on the ratio established in the partnership agreement for sharing profits and losses.

Liquidation of a Partnership Often Includes Sale of Assets at a Loss.When