Assertion(A)- Production is the most important activity of an enterprise.
Reason(R)- Production plan is to be mandatorily prepared by all business enterprises.

A is correct, but R is incorrect

Production, the most important activity of an enterprise, because it is here that transformation of raw material into finished product takes place with the help of energy, capital, manpower and machinery. Being highly complex and tedious, the manufacturing operation needs to be well planned. No doubt it will be nature of venture which will decide the magnitude of importance and disclosure required under the production plan.If the new venture does not include any manufacturing function, say it’s a trading firm or a service provider, then this section will stand eliminated from the plan.