Carlita retires from Mortex Associates,a partnership.The business is continued by the remaining partners.What is Carlita's liability on debts incurred while she was a partner?
A)Carlita has liability to the extent of her capital contribution.
B)Carlita is fully liable.
C)Carlita has no liability.
D)Carlita has liability to the extent of partnership assets at the time of dissociation.

Question

Quizplus · Accepted Answer

Dissociated partners remain liable to partnership creditors for partnership liabilities incurred while they were partners;however,a dissociated partner's liability may be eliminated by the process of novation.

Carlita Retires from Mortex Associates,a Partnership