| Assertion |
| At the time of admission of a new partner: |
| Assets will be revalued |
| Liabilities will be reassessed |
| Gain or loss on Revaluation will be shared by the old partners in their old profit sharing ratio |
| Reason (R): |
| At the time of admission of a partner, the assets and liabilities should be brought to their current values so that new partner is not put to an advantage or disadvantage because of the change in values of assets and liabilities. |
| Choose the Correct Option from the following: |
A) Assertion and Reason both are correct and Reason is the correct explanation of assertion
B) Assertion and Reason both are correct but Reason is not correct explanation of assertion
C) Both Assertion and Reason are not correct
D) Only Assertion is correct
Correct Answer: A
Solution :
Assertion and Reason both are correct and Reason is the correct explanation of assertion
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