Or
b)
What do you mean by Dissolution of fums? What are the causes of Dissolution of a firm?
How do you settled the insolvent partner dues under 'Garner vs Murray' decision?
Answers
Answer:
On dissolution of the firm, the business of the firm ceases to exist since its affairs are would up by selling the assets and by paying the liabilities and discharging the claims of the partners. The dissolution of partnership among all partners of a firm is called dissolution of the firm.
Explanation:
Causes of Dissolution of Partnership Firms
Dissolution by Agreement. ...
Dissolution by Notice. ...
Insolvency of Partners. ...
Commitment to Illegal Business. ...
Death of a Partner. ...
Expiry of Term. ...
Completion of Work or Contract. ...
Resignation of Partner..
garner vs Murray
This contention was broadly upheld in garner vs. Murray. (b) Second, the loss due to the insolvency of a partner should be divided among the other partners in the ratio of capitals then standing (i.e., after partners have brought in cash equal to their shares of loss on realisation).