Chapter 14, Problem 14.3.4P

To determine

Concept introduction

Partner withdrawing from the partnership.

Within the guidelines of the agreed agreement partners may withdraw from partnership or state law if there is no agreement between the partners. Withdrawal of partner from a partnership affects many aspects of the form of business like effect on capital or the complete partnership firm can dissolve and get out of the business.

To prepare: The capital balance for G and C assuming that Z sells his interest in the partnership and the goodwill traceable to the withdrawing partner is recognized and suggested a decrease in the value of the assets are recognized.