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NCERT Solutions

Dissolution of Partnership Firm

CBSE · Class 12 · Accountancy

NCERT Solutions for Dissolution of Partnership Firm — CBSE Class 12 Accountancy.

127 questions80 flashcards5 concepts

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A comparison chart highlighting the key differences between the dissolution of a partnership and the dissolution of a partnership firm, focusing on business termination, settlement of assets/liabiliti
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26 Questions Solved · 3 Sections

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Test your Understanding – I

1Dissolution of a partnership is different from dissolution of a firm.Show solution
The chapter states that dissolution of partnership only changes the relationship among partners, while dissolution of firm ends the business completely. So they are different.

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2A partnership is dissolved when there is a death of a partner.Show solution
The chapter says that death of a partner causes dissolution of partnership, though the firm may continue if the partners decide so.

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3A firm is dissolved when all partners give consent to it.Show solution
A firm is dissolved with the consent of all the partners. Therefore, this statement is true.

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4A firm is compulsorily dissolved when a partner decide to retire.Show solution
A partner deciding to retire leads to dissolution of partnership, not compulsory dissolution of the firm. Compulsory dissolution happens in cases like insolvency of all partners or illegality of business.

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5Dissolution of a firm necessarily involves dissolution of partnership.Show solution
The chapter says that dissolution of the firm necessarily brings dissolution of the partnership. So if the firm is dissolved, the partnership also ends.

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6A firm is compulsorily dissolved when all partners or when all except one partner become insolvent.Show solution
The chapter states that a firm is compulsorily dissolved when all the partners or all but one partner become insolvent.

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7Court can order a firm to be dissolved when a partner becomes insane.Show solution
Yes. Under dissolution by court, one ground is when a partner becomes insane.

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8Dissolution of partnership can not take place without intervention of the court.Show solution
The chapter says dissolution of partnership may take place without intervention of court. So court intervention is not necessary.

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Test your Understanding – II

1On dissolution of a firm, bank overdraft is transferred to :Show solution
On dissolution, bank overdraft is an external liability, so it is transferred to the Realisation Account.

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2On dissolution of a firm, partner's loan account is transferred to:Show solution
The chapter states that partner's loan is paid through Bank Account and is not transferred to Realisation Account. So the correct option is None of the above.

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3After transferring liabilities like creditors and bills payables in the Realisation Account, in the absence of any information regarding their payment, such liabilities are treated as:Show solution
In the absence of information, creditors and bills payable are treated as fully paid in Realisation Account.

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4When realisation expenses are paid by the firm on behalf of a partner, such expenses are debited to:Show solution
When realisation expenses are paid by the firm on behalf of a partner, the chapter says the amount is debited to the partner's capital account.

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5Unrecorded assets when taken over by a partner are shown in :Show solution
An unrecorded asset taken over by a partner is credited in the Realisation Account because the asset is being disposed of through realisation.

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6Unrecorded liabilities when paid are shown in:
7The accumulated profits and reserves are transferred to :
8On dissolution of the firm, partner's capital accounts are closed through:

Test your Understanding – III

1All assets (except cash/bank and fictitious assets) are transferred to the ________ (Debit/Credit) side of ________ Account (Realisation/Capital).
2All ________ (internal/external) liabilities are transferred to the ________ (Debit/Credit) side of ________ account (Bank/Realisation).
3Accumulated losses are transferred to ________ (Realisation/Capital Accounts) in ________ (equal ratio/profit sharing ratio).
4If a liability is assumed by a partner, such Partner's Capital Account is ________ (debited/credited).
5If a partner takes over an asset, such (Partner's Capital Account) is ________ (debited/credited).
6No entry is required when a ________ (partner/creditor) accepts a fixed asset in payment of his dues.
7When creditor accepts an asset whose value is much more than the amount due to him, he will __________ (pay/not pay) the excess amount which will be credited __________ Account.
8When the firm has agreed to pay the partner a fixed amount for realisation work irrespective of the actual amount spent, such fixed amount is debited to (Realisation/Capital) Account and Credited to (Capital/Bank) Account.
9Partner's loan is __________ (transferred/not transferred) in the (Realisation Account).
10Partner's current accounts are transferred to respective __________ Partners' (Loan/Capital) Accounts.

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Frequently Asked Questions

What are the important topics in Dissolution of Partnership Firm for CBSE Class 12 Accountancy?
Dissolution of Partnership Firm covers several key topics that are frequently asked in CBSE Class 12 board exams. Focus on the core concepts listed on this page and practise related questions to build confidence.
How to score full marks in Dissolution of Partnership Firm — CBSE Class 12 Accountancy?
Understand the core concepts first, then work through the 127 practice questions available for this chapter. Revise formulas and definitions regularly, and use flashcards for quick recall before the exam.
Where can I get free NCERT Solutions for Dissolution of Partnership Firm Class 12 Accountancy?
This page has free step-by-step NCERT Solutions for every exercise question in Dissolution of Partnership Firm (CBSE Class 12 Accountancy) — written the way examiners award marks: given, formula, working, answer.

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