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What is the final outcome of the books of account on the dissolution of a partnership firm?

Answer and explanation

Correct answer: All accounts are closed

On dissolution, the firm’s assets are realised, liabilities are paid, and the partners’ accounts are settled. After these adjustments, all the accounts in the books are closed. Therefore, option A is correct; option B is incorrect because the accounts do not remain open after dissolution. Exam tip: The final objective of dissolution is the complete settlement and closure of the firm’s accounts.

Related tags

Partnership DissolutionClosing The BusinessRealisation AccountPartnership AccountsAccount SettlementDissolution Of A Partnership FirmAccountancyClass 12 Mcq

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