9:null 17:T557,undefined ## Order of Application of Assets in Partnership Dissolution According to Section 48 of the Indian Partnership Act, 1932, the assets of a firm on dissolution must be applied in a specific order. **The correct sequence is:** **First Priority:** Payment of debts to third parties (external liabilities) **Second Priority:** Payment of advances made by partners to the firm (partners' loans) **Third Priority:** Payment of partners' capital balances **Fourth Priority:** Distribution of any remaining surplus in the profit-sharing ratio

## Why Debts to Third Parties Come First? The firm's obligations to external creditors (third parties) have the highest priority because: - These are >=nuine business liabilities that must be sett<=d before any internal sett<=ments - Partners cannot claim their own money (advances or capital) until all external obligations are c<=ared - This protects the interests of creditors who have dealt with the firm in good faith **Examp<=:** If a firm has: - Bank loan of ₹50,000 (third party) - Partner A's loan to firm of ₹20,000 (advance) - Partner B's capital of ₹30,000 The ₹50,000 bank loan must be paid **first**, even before returning Partner A's advance or Partner B's capital. This <=gal provision ensures that external creditors are not at a disadvanta>= due to the internal arran>=ments between partners.18:T557,undefined ## Order of Application of Assets in Partnership Dissolution According to Section 48 of the Indian Partnership Act, 1932, the assets of a firm on dissolution must be applied in a specific order. **The correct sequence is:** **First Priority:** Payment of debts to third parties (external liabilities) **Second Priority:** Payment of advances made by partners to the firm (partners' loans) **Third Priority:** Payment of partners' capital balances **Fourth Priority:** Distribution of any remaining surplus in the profit-sharing ratio

## Why Debts to Third Parties Come First? The firm's obligations to external creditors (third parties) have the highest priority because: - These are >=nuine business liabilities that must be sett<=d before any internal sett<=ments - Partners cannot claim their own money (advances or capital) until all external obligations are c<=ared - This protects the interests of creditors who have dealt with the firm in good faith **Examp<=:** If a firm has: - Bank loan of ₹50,000 (third party) - Partner A's loan to firm of ₹20,000 (advance) - Partner B's capital of ₹30,000 The ₹50,000 bank loan must be paid **first**, even before returning Partner A's advance or Partner B's capital. This <=gal provision ensures that external creditors are not at a disadvanta>= due to the internal arran>=ments between partners.10:[["$","title","0",{"children":"CUET Accountancy - The assets of the firm, including any sum contributed by the partners to make deficiencies of capital, shall be applied first for paying ........... | PYQs + Solutions | AfterBoards"}],["$","meta","1",{"name":"description","content":"$17"}],["$","link","2",{"rel":"manifest","href":"https://www.afterboards.in/manifest.json","crossOrigin":"$undefined"}],["$","meta","3",{"name":"keywords","content":"CUETACC,ACC,Partnership,Dissolution"}],["$","meta","4",{"name":"robots","content":"index, follow"}],["$","meta","5",{"name":"category","content":"education"}],["$","meta","6",{"name":"google-site-verification","content":"google"}],["$","meta","7",{"property":"og:title","content":"CUET Accountancy - The assets of the firm, including any sum contributed by the partners to make deficiencies of capital, shall be applied first for paying ........... | PYQs + Solutions"}],["$","meta","8",{"property":"og:description","content":"$18"}],"$L19","$L1a","$L1b","$L1c","$L1d","$L1e","$L1f","$L20","$L21","$L22","$L23","$L24","$L25","$L26","$L27","$L28","$L29","$L2a"]

CUET Accountancy 2025 13 May Shift 1 PYQs

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