Question

In which of the following cases, a partnership firm may be dissolved?
X. On the death of a partner.
Y. On the insolvency of a partner
Z. On the retirement of a partner
Correct option is _______________.

• A. X and Y
• B. X and ?-
• C. Y and Z
• D. X, Y and Z

Answer 1

Answer: (D)

X, Y and Z

Partnership may get dissolved in the following cases :

1. On the death of partner : The death of the partner may affect the working of the organization. As these partners are dependent on each other. So the partnership may get dissolved and new partnership is formed.

2. On the insolvency of a partner : When a partner becomes banckrupt or insolvent which means his liabilities are more than the assets he owns , partnership firm gets dissolved and new partnership is formed.

3. On retirement of the partner : On the retirement of the partners account is settled and new partnership deed is formed.