On dissolution of a firm out of the proceeds received from the sale of assets will be paid first of ...........

On dissolution of a firm, out of the proceeds received from the sale of assets will be paid first of all

Partner’s Capital

Partner’s Loan to Firm

Partner’s additional capital

Outside Creditors

- Option 1: Partner’s Capital

- Refers to the funds contributed by partners.

- Repaid last among the liabilities when the firm is dissolved.

- Option 2: Partner’s Loan to Firm

- Any loans made by partners separate from their capital contributions.

- Paid before partners' capital but after external liabilities.

- Option 3: Partner’s Additional Capital

- Extra funds invested by partners beyond their agreed capital.

- Similar to partner’s capital, settled after external debts.

- Option 4: Outside Creditors

- Consists of debts owed to third parties, not partners.

- Paid first to clear any external liabilities before settling with partners.

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