Question : Assertion (A): A loan from a relative of a partner is an external liability.

Reason (R): It is not transferred to the Realisation Account.

Option 1: Assertion (A) and Reason (R) are correct but the reason (R) is not the correct explanation of Assertion (A)

Option 2: Both, Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).

Option 3: Assertion (A) is correct but the Reason (R) is not correct.

Option 4: Both Assertion (A) and Reason (R) are not correct.

Question : Assertion (A): The partner’s Private Property can be applied to pay the firm’s debt.

Reason (R): In a partnership firm, partners have unlimited liability.

Option 1: Assertion (A) and Reason (R) are correct but the reason (R) is not the correct explanation of Assertion (A)

Option 2: Both, Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).

Option 3: Only Assertion (A) is correct.

Option 4: Assertion (A) is not correct but the Reason (R) is correct.

Question : Assertion (A) Currency held by the public is a monetary liability of the central bank.

Reason (R) Central bank controls credit, whereas commercial banks create credit with the currency held by the public.

Option 1: Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)

Option 2: Both Assertion (A) and Reason (R) are true but Reason (R) is the not correct explanation of Assertion (A)

Option 3: Assertion (A) is true, but Reason (R) is false.

Option 4: Assertion (A) is false, but Reason (R) is true.

Question : Assertion (A): Balance at Banks is transferred to Realisation Account.

Reason (R): Balance at Bank is not to be realised but instead distributed in its present form.

Option 1: Assertion (A) and Reason (R) are correct but the reason (R) is not the correct explanation of Assertion (A)

Option 2: Both, Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).

Option 3: Only Assertion (A) is correct.

Option 4: Assertion (A) is not correct but the Reason (R) is correct.

Question : Assertion: A purchase of furniture on credit will not result in flow of cash or cash equivalents
Reason R: - purchased of furniture on credit will not involve cash.

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

Option 1: Assertion A and reason R are correct and reason R is correct explanation of assertion A

Option 2: Assertion A and reason R are correct but reason R is not the correct explanation of Assertion A

Option 3: Both assertion A and reason R are not correct

Option 4: Assertion A is correct but the reason R is not correct