Given below are two statements, one labelled as Assertion (A) and the other labelled as Reason (R) :

Assertion (A) : When a company earns profit prior to its incorporation, it is called capital profit.

Reason (R) : Capital profit cannot be used for distribution as dividend to the shareholders. In the context of the above two statements, which one of the following is correct ?

Codes :                                                                                    (2 marks)