Question

Assertion (A): Amount due to retiring partner is always transferred to his Loan Account bearing interest @ 6% p.a.

Reason (R): Amount due to retiring partner may be paid immediately or later in instalments with agreed rate of interest.

In the context of the above two statements, which of the following is correct?

Options

• (A) and (R) both are correct and (R) correctly explains (A).

• Both (A) and (R) are correct and (R) does not explain (A).

• Both (A) and (R) are incorrect.

• (A) is incorrect but (R) is correct.

Answer 1

(A) is incorrect but (R) is correct.