The following are the features of the Dissolution of Partnership:(A) Assets and liabilities are revalued, and a new balance sheet is drawn.(B) Economic relationships between partners continue, though in a changed form.(C) The business is not terminated.(D) The books of account are closed.Choose the correct answer from the options given below:
- A(A), (B) and (D) only
- B(A), (B) and (C) only
- C(A), (B), (C) and (D)
- D(B), (C) and (D) only
Solution & Step-by-step Explanation
Dissolution of partnership refers to the reconstitution of the firm (due to admission, retirement, death, or change in profit sharing ratio). In this case:Assets and liabilities are revalued, and a new balance sheet is drawn (Statement A is correct).The economic relationship between partners continues in a modified format (Statement B is correct).The business itself is not terminated (Statement C is correct).Statement D ("The books of account are closed") is a feature of the Dissolution of the Firm, not just the dissolution of a partnership.Hence, statements (A), (B), and (C) are the true features of the dissolution of partnership.