Question 21 of 33
Q.Do you agree or disagree with the following statement:
On dissolution, cash/bank account is closed automatically.
Maharashtra MsbshseMaharashtra HSC (MSBSHSE) Board 2024Subjective· 1mImportance★★★★★
64% · 21/33 Questions
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Start your 14-day free trial to unlock the full solution →True. When a firm is dissolved, the Cash/Bank Account records every final receipt and payment; once the partners' capital balances are paid off, both sides become equal and the account closes on its own — it is a check on the accuracy of the whole dissolution.
On dissolution the closing sequence works like this:
| Step | Effect on Cash/Bank A/c |
|---|---|
| Assets realised (sold) | Cash received → debit side |
| Liabilities & realisation expenses paid | Cash paid → credit side |
| Loans/partner's loan repaid | Cash paid → credit side |
| Final settlement of partners' capital | Deficient partner brings cash (debit) / balance paid to partners (credit) |
| … |
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