When Tamar Snyder opened a shoe store,her accountant did not include the cash in her personal savings account as one of the assets of the business.This is an example of
A) the separate entity assumption.
B) the conservatism constraint.
C) the materiality constraint.
D) industry practice constraint.

Question

Quizplus · Accepted Answer

The accountant's omission of Tamar's personal savings account from the business's assets is an example of the separate entity assumption, which requires that business transactions be kept separate from personal transactions. This assumption is a core principle in accounting and is necessary for accurate financial reporting.

When Tamar Snyder Opened a Shoe Store,her Accountant Did Not