Question

Assertion (A): Revaluation A/c is prepared at the time of Admission of a partner.

Reason (R): It is required to adjust the values of assets and liabilities at the time of admission of a partner, so that the true financial position of the firm is reflected.

Options

• Both (A) and (R) are correct and (R) is the correct reason of (A)

• Both (A) and (R) are correct but (R) is not the correct reason of (A)

• Only (R) is correct

• Both (A) and (R) are wrong

Answer 1

Both (A) and (R) are correct and (R) is the correct reason of (A)