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Assertion (A): Workmen compensation reserve is created out of firms’ profit to meet possible liability on account of compensation to employees, if it arises. Reason (R): Workmen compensation reserve existing in balance sheet against which no liabilities exists, is transferred to capital accounts of partners in their sacrificing ratio. a. Both A and R are correct and R is the correct explanation of A. b. Both A and R are correct but R is not the correct explanation of A. c. A is correct but R is wrong d. A is wrong but R is correct. |
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Answer» c. A is correct but R is wrong |
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