Terms Introduced in the Chapter

Dissolution of partnership is a change in the relationship among the partners — as on an admission, retirement or death — that ends the existing agreement but does not necessarily …

Dissolution of a partnership firm is the complete closing down of the firm's business, where all the assets are realised, all the liabilities are paid off and the accounts among t …

A partnership at will is one formed without fixing any period for its duration; any partner may bring it to an end simply by giving notice to the others of his in …

Compulsory dissolution is the dissolution of a firm that happens automatically by operation of law — for example, when all the partners, or all but one, become insolvent, or when the …

Dissolution by notice is the ending of a partnership at will when one partner gives written notice to the other partners of his intenti …

Realisation expenses are the costs incurred in closing down the firm, such as the expenses of selling the assets and settling the liabilities; they are debite …

The Realisation Account is the account prepared on dissolution to record the sale of the assets and the payment of the liabilities; the profit or loss it shows is shared by the partne …