Dissolution of the Partnership and Dissolution of the firm

Dissolution of the Partnership: 

1. A partnership is dissolved when a new partner is admitted or on old partner retires or dies.
2. The business of the firm is not terminated.
3. In the event of dissolution of partnership, assets and liabilities are revalued and new balance sheet is drawn.
4. Revaluation Account is prepared to ascertain the profit/loss . on revaluation.
5. The dissolution of a partnership will create a new partnership

Dissolution of the Firm :

1. A firm is dissolved by the partners mutually or by the court.
2. The dissolution of the firm means the termination of Partnership business.
3. In the event of dissolution of firm, assets are realized and liabilities are paid off.
4. Realization Accounts prepared to ascertain the profit or loss on realization
5. The dissolution of a firm will not create a new partnership.