Multiple choice

The deficiency of capital of the insolvent partner to the tune of Rs. 80,000 gets distributed among solvent partners B and C where capitals of Rs. 40000, Rs. 40000 respectively between B and C.

  1. True

  2. False

  3. Partly true

  4. Cannot say

Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

When an insolvent partner cannot contribute their share of capital deficiency (Rs. 80,000), that deficiency is distributed among the solvent partners in proportion to their capital contributions. With B and C having equal capitals (Rs. 40,000 each), they would share the deficiency equally - Rs. 40,000 each.