Partner Retirement via Asset Withdrawal

Steps:

• Examine entries: Debits to motor vehicle (7000) and bank (15000) show assets transferred out; balance (14000) and current account (5000) reflect capital owed.
• Calculate total withdrawal: 7000 + 15000 = 22000, matching settled capital (14000 + 5000 + implied adjustments).
• Interpret context: Equal profit-sharing implies N's exit; entries align with settlement, not addition.
• Confirm via accounting: Debits reduce partnership assets and partner's capital liability.

Why D is correct:

• Partnership law (e.g., under Partnership Act) allows retiring partner to receive assets in kind or cash to settle capital balance, directly matching debit entries for motor vehicle and bank.

Why the others are wrong:

• A: Purchase would credit N's capital and debit business assets, not debit N's capital account.
• B: Introducing assets for retirement credits capital first, opposite of withdrawal debits shown.
• C: Increasing capital debits bank/motor vehicle to partnership, crediting N's capital—not matching debit pattern.

Final answer: D