Dissolution of Partnership Firm — NCERT Solutions

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.

The chapter says that death of a partner causes dissolution of partnership, though the firm may continue if the partners decide so.

A firm is dissolved with the consent of all the partners. Therefore, this statement is true.

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.

The chapter says that dissolution of the firm necessarily brings dissolution of the partnership. So if the firm is dissolved, the partnership also ends.

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

Yes. Under dissolution by court, one ground is when a partner becomes insane.

The chapter says dissolution of partnership may take place without intervention of court. So court intervention is not necessary.

On dissolution, bank overdraft is an external liability, so it is transferred to the Realisation Account.

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.

In the absence of information, creditors and bills payable are treated as fully paid in Realisation Account.

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.

An unrecorded asset taken over by a partner is credited in the Realisation Account because the asset is being disposed of through realisation.