Assertion (A): Premium receivedon issue of shares is credited to share premium account but not to profit and loss account.
Reason (R): Since share premium is not a trading profit, it is not distributed to shareholders.

A. Both (A) and (R) are correct, but (R) is not the correct explanation of (A)

B. (A) is incorrect, but (R) is correct

C. Both (A) and (R) are correct, and (R) is the correct explanation of (A)

D. (A) is correct, but (R) is incorrect

Answer: Option C