Partnership

Dissolution

Medium

Court may not order for dissolution of a partnership firm out of which of the following grounds:

When a partner become insane

When a partner becomes permanently incapable of performing his duties as a partner

When the business of the firm cannot be carried on except at a loss

On the death of a partner

✅ Correct Option: 4

Death of a partner is a compulsory/contingent ground for dissolution, which happens automatically by operation of law and does not require a court order. Insanity of a partner, permanent incapacity, and continuous losses are all grounds on which a partner may apply to the court for dissolution under the Partnership Act.

2025: 26 May Shift 2

Partners' current accounts are transferred to respective Partners' ______ Accounts.

2026: 24 May Shift 1

In case of dissolution, match List-I with List-II.

List-I	List-II
(A) Partner's Loan is transferred to	(I) Credit side of Partners' Capital Account
(B) External Liabilities (appearing in balance sheet) are transferred to	(II) Debit side of Partners' Capital Account
(C) The accumulated profits and reserves are transferred to	(III) Bank Account
(D) The accumulated losses are transferred to	(IV) Realisation A/c

Choose the correct answer from the options given below:

2025: 14 May Shift 2

On dissolution of the firm, partner's capital accounts are closed through-

2025: 22 May Shift 2

When realisation expenses are paid by the firm on behalf of a partner, such expenses are debited to

2025: 27 May Shift 2

Identify the steps involved in the accounting treatment in the case of dissolution of firm:

(A) Capital accounts of partners are prepared and their final settlement is done.

(B) The balance of realisation account (profit or loss on realization) is transferred to partners' capital accounts in the profit sharing ratio.

(D) Realisation account is prepared.

(E) Bank account is prepared.

Choose the correct answer from the options given below:

2026: 21 May Shift 1

As per the provisions of Section 48 of Indian Partnership Act, firm's assets are to be used in the prescribed order in case of dissolution of a firm. Arrange the following in order.

(A) In paying partner's loan

(B) The residue, if any, shall be divided among the partners in their profit sharing ratio

(D) In paying the debts of the firm to the third parties

Choose the correct answer from the options given below:

Court may not order for dissolution of a partnership firm out of which of the following grounds:

Solution

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