Multiple choice

Dissolution of a firm may take place

  1. by the adjudication of all the partners or of all the partners but one as insolvent

  2. as a result of any agreement between all the partners

  3. by the business of the firm becoming unlawful

  4. all of these
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

A partnership firm can dissolve through multiple channels: compulsory dissolution when all partners or all but one are adjudicated insolvent (A), voluntary dissolution by mutual agreement among all partners (B), or dissolution when the business becomes unlawful (C). All three are recognized grounds for dissolution under the Partnership Act.

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