Question 3 of 53beginner💡 UnderstandTrue / False1 mark

A firm is dissolved when all partners give consent to it.

Correct Answer

True

Exercise: Test your Understanding – I | Q: 3 | (Page 3)
For More Understanding

Explanation

According to the context, under 'Dissolution by Agreement', a firm is dissolved with the consent of all the partners. This is one of the recognized ways in which a partnership firm can be dissolved without court intervention.

Solution Steps

  1. Step 1: The statement claims that a firm is dissolved when all partners give consent to it.

  2. Step 2: The context clearly states under 'Dissolution by Agreement' that a firm is dissolved 'with the consent of all the partners'.

  3. Step 3: Therefore, the statement is True as it correctly describes one of the modes of dissolution.

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