Given below are two statements, one labelled as Assertion (A) and the other labelled as Reason (R).
Assertion (A): Investment Fluctuation Reserve distributed in Old Profit-Sharing Ratio at the time of Reconstitution of partnership.
Reason (R): It is required to adjust the fluctuation in the value of Investment by Investment Fluctuation Reserve and remaining amount written off by credit in Old/All partners' Capital Current Account in case of reconstitution of partnership because it's earning of old partners.
In the context of the above two statements, which of the following is correct?
1
Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).
2
Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).
3
Assertion (A) is true, but Reason (R) is false.
4
Assertion (A) is false, but Reason (R) is true.