Question : Choose which of the following statements is correct.
Option 1: Change in the profit-sharing ratio among the existing partners results in reconstitution of the firm.
Option 2: Change in Profit-sharing Ratio leads to dissolution of partnership and not of the firm.
Option 3: Both 1 and 2
Option 4: None of the above
Correct Answer: Both 1 and 2
Solution : Answer = Both 1 and 2
When there's a change in the profit-sharing ratio among existing partners, it results in the reconstitution of the firm. However, a change in the profit-sharing ratio does not lead to the dissolution of the partnership or the firm, as the partnership can continue with the new profit-sharing arrangement. Hence, the correct option is 3.
Question : Which of the following does not result in consideration of a firm?
Option 1: Dissolution of partnership firm
Option 2: Dissolution of partnership
Option 3: Change in profit sharing ratio of existing partners
Option 4: Death of partners
Question : Change in the existing agreement between the partners is called
Option 1: Dissolution of Firm
Option 2: Reconstitution of Partnership
Option 3: Dissolution of Business
Option 4: None of the Above
Question : On dissolution of a partnership firm, profit or loss on realisation is distributed among the partners ________.
Option 1: In capital ratio
Option 2: In Profit sharing ratio
Option 3: Equally
Question : On dissolution of a partnership firm, profit or loss on realisation is distributed among the partners -
Question : The dissolution of partnership between all the partners of a firm is called:
Option 1: Reconstitution of partnership firm
Option 3: Dissolution of partnership firm
Option 4: Any of the above
Regular exam updates, QnA, Predictors, College Applications & E-books now on your Mobile