--%>

Explain Dissolution

1) Dissolution ENDS the partnership.

a) Action of the parties:

• By the expiration of a fixed term;
• If entered into for a single undertaking, and the completion of the undertaking;
• By a partner giving notice where no time is
specified.

b) Operation of law:

• By a partner giving notice;
• Death or bankrupt.

c) Illegality:

2) A partner may apply to the court to have the partnership dissolved on the grounds of:

  • Insanity of a partner;
  • Permanent incapacity;
  • Conduct of a partner detrimental to the interests of the
  • partnership;
  • Wilful or persistent breach of partnership
  • agreement;
  • Where the partnership can merely be carried on at a loss; and
  • Where the court considers it mere and equitable.

3) Each partner is entitled to a proportionate return of their contribution to capital before distribution.

4) If the partnership is being dissolved because of death, insolvency or bankruptcy, it is necessary to differentiate between partnership property and private property to determine the rights of the different groups of creditors.

   Related Questions in Managerial Accounting

  • Q : Number of Partners in Partnership What

    What is the maximum and minimum number of partners in each and every type of partnership? Answer: There must be at least two persons to build a Partnership. The maxi

  • Q : Selecting strategic options and

    Write a short note on selecting strategic options and formulating the plans?

  • Q : Cash flows from operating activities A

    A financial analysis tools that measures the need for financing. The formula is the cash-flow from operating activities divided by the cash paid for long-term asset. Cash paid for long-term assets can be found on the statement of cash-flow, in the investing-activities

  • Q : What is Partnership Partnership :

    Partnership: Whenever two or more persons enter into an agreement to take on business and share its gain and losses, it is a condition of partnership. It can also define as: "Partnership is the relation among persons and who have granted to share the

  • Q : Define Common Cost Common Cost : It is

    Common Cost: It is the cost of resources used jointly in the production of two or more outputs and the cost can’t be directly traced to any one of those outcomes.

  • Q : Information that a manager need to make

    What is the various information that a manager need to make a decision?

  • Q : Budgetary accounts Accounts used in

    Accounts used in governmental accounting to record the budget amounts but not the actual amount. For example, at the beginning of the accounting period, the planned amount of tax revenue, revenue from license, and inflows from fines would be recorded as one amount in

  • Q : Determine & Analysis on Income

    The DU Inn The DU Inn is an 80-room hotel located on some mountaintop in Colorado. That has no bar or restaurant &is positioned as a mid-priced, good quality "homey" hotel.  It is open only during

  • Q : Why most of the larger businesses are

    Why most of the larger businesses are not managed as the single unit through one manager?

  • Q : Analysis on Business Profile BUSINESS

    BUSINESS PROFILES:Go to the following webpage by clicking on the link or by copying and pasting the URL into your web browser:After opening the link, you will see a small cover page of the West Newsmagazine’s publication titled “Business Profiles&rdq