A basic assumption of accounting that requires activities of an entity be kept separate from the activities of its owner is referred to as the
A) stand alone concept.
B) monetary unit assumption.
C) corporate form of ownership.
D) economic entity assumption.

Question

Quizplus · Accepted Answer

The economic entity assumption is the basic assumption of accounting that requires activities of an entity be kept separate from the activities of its owner. It means that the financial transactions of a business must be recorded separately from the personal transactions of its owners or any other businesses.

A Basic Assumption of Accounting That Requires Activities of an Entity