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Why is it that the Capital account of a partener does not show a ' Debit balance' in spite of regular and consistent losses year after year?




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The capital account of a partner only shows a debit balance when said partner withdraws an amount from his investment or he withdraws from the partnership.

It does not show a debit balance in spite of regular and consistent losses year after year because these losses are first applied to the company's assets or is recorded as part of a company's liability. 
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