Question

Assertion (A): Dissolution of the firm means the dissolution of the partnership between all the partners of the firm.

Reason (R): Dissolution of the firm means closure of business and therefore means dissolution of the partnership also.

In the context of the above two statements, which option is correct?

विकल्प

• Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A).

• Both, Assertion (A) and Reason (R) are correct, and Reason (R) is the correct explanation of Assertion (A).

• Only Assertion (A) is correct.

• Assertion (A) is not correct, but the Reason (R) is correct.

Answer 1

Both, Assertion (A) and Reason (R) are correct, and Reason (R) is the correct explanation of Assertion (A).

Explanation:

Dissolving a firm means permanently closing down the business, which breaks the relationship between all partners, making the assertion true. Since the business entity itself stops existing, it automatically ends the partnership agreement, making the reason the correct explanation.