Question

Campanella, Bell, and Lavar have been partners for years, but a court is now dividing the assets and liabilities of the partnership separate from the assets and liabilities of the individual partners. This process is called:

a.	marshaling assets.
	b.	liquidation.
	c.	winding up.
	d.	dissolution of the partnership.

Answer 1

In a partnership form the partners may agree on a common terms to liquidate all the Assets and pay off the liability if they want to discontinue the operations. This is called as liquidation of the firm. Also after the process of liquidation the form as to enter a process of winding up where by bhai all the the ongoing transaction as well as assets liabilities are closed and dissolved. But both of these are done with the mutual consent of the partners and there is no involvement of court.

Whereas when the court divide the asset and liabilities of the partnership firm it is called as dissolution of firm as in this case court plays a major role in selling off the Assets and taking off the liabilities.

Therefore the correct option is D