" Given below are two statements, one labelled as Assertion (A) and the other labelled as Reason (R): Assertion (A): Revaluation Account is prepared at the time of admission of a partner. Reason (R): It is required to adjust the values of assets and liabilities at the time of admission of a partner, so that the true financial position of the firm is reflected. In the context of the above two statements, which of the following is correct? "

Both (A) and (R) are correct and (R) is the correct reason of (A). Both (A) and (R) are correct but (R) is not the correct reason of (A). Only (R) is correct. Both (A) and (R) are wrong

Both (A) and (R) are correct and (R) is the correct reason of (A).

Both (A) and (R) are correct and (R) is the correct reason of (A). Revaluation account is a nominal account prepared for the purpose of distributing and transferring the profit or loss arising out of an increase or decrease in the book value of assets and liabilities of the partnership firm at the time of change in profit sharing ratio, admission of a partner, the retirement of a partner. It is required to adjust the values of assets and liabilities at the time of admission of a partner, so that the true financial position of the firm is reflected.