Question

Assertion (A): The accounting equation is Assets = Liabilities + Capital.

Reasoning (R): This equation represents the fundamental relationship between a company’s resources, debts, and ownership.

पर्याय

• A is true but R is false.

• A is false but R is true.

• Both A and R are true and R explains A.

• Both A and R are true but R does not explain A.

Answer 1

Both A and R are true and R explains A.

Explanation:

The accounting equation Assets = Liabilities + Capital is correct, and the reasoning correctly explains it as the fundamental relationship between a company’s resources, debts, and ownership.