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Home Questions HQUWCMJVSJ
Target Exam

CUET

Subject

Accountancy

Chapter

Dissolution of Partnership Firm

Question:

Assertion (A): Dissolution of partnership is different from the dissolution of the Partnership firm.
Reason (R): Dissolution of partnership doesn’t dissolve the firm but dissolution of a firm dissolves the partnership.

Options:

(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).

Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct e₹planation of Assertion (A).

Assertion (A) is true, but Reason (R) is false

Assertion (A) is false, but Reason (R) is true.

Correct Answer:

(A) Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).

Explanation:

Dissolution of partnership means reconstitution of the firm due to change in the profit sharing ratio among existing partners, admission of a new partner, retirement of a partner, death of a partner, insolvency of a partner and the firm continues as before. However, the dissolution of partnership does not lead to the dissolution of firm.

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