Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Dissolution of Partnership Firm

Question:

On dissolution of a firm, out of the proceeds received from the sale of assets will be paid first of all to whom?

Options:

Partner's Capital

Partner's Loan to Firm

Partner's additional capital

Outside Creditors

Correct Answer:

Outside Creditors

Explanation:

On dissolution of a firm, out of the proceeds received from the sale of assets will be paid first of all to third party debts and the outside creditors is third party debt to which a partnership firm has to pay.