CBSE 2025, Set 3

Question

Read the following statements: Assertion (A) and Reason (R). Choose the correct option.

**Assertion (A):** The liability of a partner for acts of the firm is unlimited.
**Reason (R):** A partner's private assets can also be used for paying off the firm's debts. A). Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A). B). Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A). C). Assertion (A) is correct, but Reason (R) is incorrect. D). Assertion (A) is incorrect, but Reason (R) is correct.

Edvaya · Accepted Answer

The correct answer is Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).. (A) Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A). **Explanation:** Since the liability of a partner is unlimited, their personal assets can be utilized to settle the firm's debts if the firm's assets fall short.

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Accountancy > Accounting For Partnership Firms > Fundamentals Of Partnership

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