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describe the rule of garner vs murray and how it relates to
the dissolution of a partnership
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Answer / sharafu
• Loss on realisastion considered being ordinary loss and therefore to be shared by all the partners according to their profit sharing ratio.
• Solvent partners to bring cash equal to their share of loss on realisation
• Loss on account of deficiency of insolvent partner considered being capital loss, therefore to be shared by solvent partners according to their capital account balance. (Capital account balance just before the dissolution of the firm)
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