SHWAL AMIE BINTI NAILIE

BG10110470
HE19
FINANCIAL ACCOUNTING

QUESTION:
DISSOLUTION PARTNERSHIP VS DISSOLUTION PARTNERSHIP FIRM. IS IT
THE SAME?

There are different between dissolution partnership and the dissolution

partnership firm. A partnership is legally dissolved when any partner leaves
or a new partner is admitted into the business. A partner leaves are due to
retirement, insolvent or death. If any of the partners are leaves and the
remaining partners still agree to continue the business of the partnership
firm, then it is dissolution of partnership not the dissolution of firm.
Dissolution of partnership changes the mutual relations of the partners. But
in case of dissolution of firm, a partnership is dissolved when the business or
sold as a going concern to a limited company or all the relations and the
business of the firm comes to an end. When a business ceased to exist, the
partners are entitled to a repayment of the capital contributed to set up the
business. Repayment will only be made once all the assets are sold and all
the liabilities settled. In practice, realisation of assets may involve a
considerable period of time.