| Assertion [A] : |
| When a company purchase a running business of other company, and payment is settled by issue of shares, in such a case, if purchase consideration is more than the net assets, then difference is debited to the. Goodwill Account. |
| Reason (R): |
| Goodwill is recorded in the books when some money or money's worth is paid for it. |
| Choose the Correct Option from the following: |
A) Assertion and Reason both are correct and Reason is the correct explanation of the assertion
B) Assertion and Reason both are correct but Reason is not correct explanation of assertion
C) Both Assertion and Reason are not correct
D) Only Assertion is correct
Correct Answer: A
Solution :
Assertion and Reason both are correct and Reason is the correct explanation of the assertion
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