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Question
In the event of dissolution of the firm, the partner’s assets are first used for payment of the following:
Options
Firm’s liabilities
Partner’s personal liabilities
None of the two
Any of the two
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Solution
Partner’s personal liabilities
Explanation:
In the event of the firm’s dissolution, the partner’s assets are initially used to settle his personal liabilities.
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| Balance Sheet as on 31st March, 2009 | |||
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