There are two statements marked as Assertion (A) and Reason (R). Mark your answer as per the codes provided below-
Assertion: Admission of a partner leads to the dissolution of the old firm and bringing the new firm into existence.
Reasoning: As a result of admission of a partner, old partners along with the new partner constitute the new firm. Thus, old firms are dissolved and new firm comes into existence.
Answer & explanation
Correct answer: option 4
The correct answer is option 4- Both Assertion (A) and Reasoning (R) are incorrect.
Assertion: Admission of a partner leads to the dissolution of the old firm and bringing the new firm into existence. This is not true as admission of the partners leads to reconstitution of the firm not the dissolution.
Reasoning: As a result of admission of a partner, old partners along with the new partner constitute the new firm. Thus, old firms are dissolved and new firm comes into existence. This is not true admission of the partners leads to reconstitution of the firm not the dissolution. It does not lead to the creation of a new firm.