Partnership

Dissolution

Medium

common

On dissolution of a firm, Investment and Investment Fluctuation Fund appeared in the balance sheet. These will be transferred to:

Investment on the credit side of Realisation account and Investment Fluctuation Fund on the debit side of Realisation account

Investment on the debit side of Realisation account and Investment Fluctuation Fund on the credit side of partners' capital account

Investment on the debit side of Realisation account and Investment Fluctuation Fund on the credit side of Realisation account

Difference between Investment and Investment Fluctuation Fund on the debit side of Realisation account

✅ Correct Option: 3

On dissolution all external assets other than cash are transferred to the debit of Realisation Account at book value, so Investment is debited there. Investment Fluctuation Fund is a fund created against that asset, so it is transferred to the credit of Realisation Account rather than distributed among partners or netted off against the investment.

2025: 27 May Shift 1

Unrecorded Liabilities when paid are shown in:

2025: 30 May Shift 1

On the dissolution of a firm, the Creditors are transferred to :

2025: 15 May Shift 1

Arrange the following in the sequence in which they shall be applied in payment at the time of dissolution of a firm:

(A) The debts of the firm to the third parties.

(B) Partner proportionately what is due to him/her from the firm for advances as distinguished from capital (i.e. partner's loan).

(D) Divided among the partners in their profit sharing ratio.

Choose the correct answer from the options given below:

2023: 28 May Shift 1

On Dissolution of partnership firm out of total debtors of Rs. 2,50,000, Rs. 10,000 became bad and the rest realised 70%. In the given case Bank A/c will be debited by :

2025: 22 May Shift 2

Match List-I with List-II

List-I	List-II
(Transaction)	(Relevant account)
(A) Settlement of Partners Loan	(I) Credit side of Realization A/c
(B) Transfer of liabilities	(II) Partner's Capital will be credited
(C) Transfer of Assets	(III) Credit Side of Bank A/c
(D) Remuneration payable to partner	(IV) Debit Side of Realization A/c

Choose the correct answer from the options given below:

2025: 3 June Shift 2

Dissolution of a partnership firm may be ordered by the court on the following grounds:

(A) when a partner becomes insane.

(B) when a partner becomes permanently incapable of performing his duties as partner.

(D) when it is regarded just and equitable by the court.

Choose the correct answer from the options given below:

On dissolution of a firm, Investment and Investment Fluctuation Fund appeared in the balance sheet. These will be transferred to:

Solution

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CUET Accountancy Past Year Questions (Topic-Wise)