If a partner's capital balance is a debit after it has absorbed its share of the loss on realization, the balance is referred to as a deficiency.

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If a partner's capital balance is a debit after absorbing its share of the loss on realization, it indicates that the partner's capital contribution was not enough to cover his or her share of the loss. In this case, the balance is referred to as a deficiency.

If a Partner's Capital Balance Is a Debit After It