"Check your connection information and that the report server is a compatible version" Error

If you have created a Reporting Services BI project. And if it is the first time that you are deploying your reports to a Reporting Services web server, you may get the below warning when you right click on the project and click Deploy on the menu:

 
Microsoft Report Designer

A connection could not be made to the report server http://ReportServer/Reports2005.
The attempt to connect to the report server failed. Check your connection information and that the report server is a compatible version. (Microsoft.ReportingServices.Designer)
The request failed with HTTP status 404: Not Found. (Microsoft.ReportingServices.Designer)

This error may occur because of false set TargetServerURL in the Business Intelligence (BI) project for Reporting Services application.

Check the TargetServerURL in the Deployment section of the project's Property  Pages screen. Check that you are using the ReportServer virtual directory of the Reporting Services instance. This error occurs when you are trying to deploy rdl reports to Reports folder instead of ReportServer folder on the target server.

Check the report server IIS for Reports and ReportServer virtual directories that are created default during Reporting Services. During the installation of Reporting Services you may have supplied other folder names than the default ones. Then be sure that you are deploying your reports to the ReportServer folder on the Report Server.