English

State Whether the following Statement is True or False: Profit of realisation on the dissolution of a firm is divided in the capital ratio.

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Question

State Whether the following Statement is True or False:

Profit of realisation on the dissolution of a firm is divided in the capital ratio.

True or False
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Solution

This statement is false.

Explanation:

Profit on realisation at the time of dissolution of a firm is divided among the partners in their profit-sharing ratio, not in the capital ratio.

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Chapter 5: Dissolution of a Partnership Firm - OBJECTIVE TYPE QUESTIONS [Page 5.98]

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D. K. Goel Accountancy Part A Volume 1 and 2 [English] Class 12
Chapter 5 Dissolution of a Partnership Firm
OBJECTIVE TYPE QUESTIONS | Q (A) 12. | Page 5.98
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