Final answer:
The answer is false; partners withdrawing from a partnership are not always entitled to the balance in their capital account due to factors like the partnership agreement, debts, and financial state of the business.
Step-by-step explanation:
Is a partner who withdraws from a partnership always entitled to the balance in his capital account? The answer to this question is false. While partners may have their own capital accounts that reflect their contributions and share of the profits, the withdrawal of these funds is not always straightforward. Upon leaving the partnership, various factors influence what the withdrawing partner is entitled to.
These include the existing agreement between partners, the financial health of the business, and the liabilities at the time of withdrawal. A partner's departure might trigger an evaluation of the partnership's assets and liabilities, which can adjust the final amount the withdrawing partner is entitled to receive, especially if the business has debts that need to be settled. Therefore, the withdrawing partner may not be able to claim the entire balance of their capital account.