Commentary

87 Allocation of profits on dissolution

BUSINESSES vol 4(2) start-up, sale and purchase
| Commentary

87 Allocation of profits on dissolution

| Commentary

87 Allocation of profits on dissolution

The default code in the Partnership Act 1890 lays down various rules for settling accounts between the partners after a dissolution, and starts by dealing with losses. It provides that losses, including losses and deficiencies of capital, must be paid first out of profits, next out of capital, and finally, if necessary, out of contributions from the partners individually in the proportion in which they were entitled to share profits1. The Partnership Act 1890 also stipulates the order in which the assets of the firm, augmented as necessary by any sums

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