The correct answer is: B. Both (A) and (R) are correct but (R) is not the correct explanation for (A)
Assertion (A) is correct because in accounting, a distinction is made between the business and the owner. The business is an entity that is separate from its owner. The owner of the business is not personally liable for the debts of the business.
Reason (R) is also correct because accounting concepts are based on self-consciousness and not on subjectivity. Accounting concepts are based on the idea that the business is a separate entity from its owner. This means that the business’s financial statements should be prepared as if the business were a separate person.
However, reason (R) is not the correct explanation for assertion (A). The distinction between the business and the owner is not based on the idea that accounting concepts are based on self-consciousness. The distinction is based on the idea that the business is a separate entity from its owner.
Here is a more detailed explanation of each option:
- Option A: Both (A) and (R) are correct and (R) is the correct explanation for (A)
This option is incorrect because reason (R) is not the correct explanation for assertion (A).
- Option B: Both (A) and (R) are correct but (R) is not the correct explanation for (A)
This option is correct because assertion (A) is correct and reason (R) is correct, but reason (R) is not the correct explanation for assertion (A).
- Option C: (A) is correct (R) is incorrect
This option is incorrect because reason (R) is correct.
- Option D: Both (A) and (R) are incorrect
This option is incorrect because assertion (A) is correct.