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Question
When all or all but one of the partners of the firm becomes insolvent and results in dissolution , this type is called
When all or all but one of the partners of the firm becomes insolvent and results in dissolution , this type is called
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Solution
The correct option is A compulsory
When all or all but one of the partners of the firm becomes insolvent and results in dissolution , this type is called compulsory dissolution.
A firm is compulsorily dissolved:
(i) By the adjudication as insolvent of all the partners or of all partners except one.
(ii) By the happening of any event which makes it unlawful for the business of the firm to be carried on or for the partners to carry it on in partnership.
When all or all but one of the partners of the firm becomes insolvent and results in dissolution , this type is called compulsory dissolution.
A firm is compulsorily dissolved:
(i) By the adjudication as insolvent of all the partners or of all partners except one.
(ii) By the happening of any event which makes it unlawful for the business of the firm to be carried on or for the partners to carry it on in partnership.
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