The separate entity concept requires that
A) the personal assets and liabilities of an owner not be shown on the business's financial statements.
B) transactions that involve an exchange of value be kept separate from those that do not.
C) tax records be kept separate from financial reporting records.
D) a separate set of books be established for each segment of a business.

Question

Quizplus · Accepted Answer

The separate entity concept requires that the personal assets and liabilities of an owner not be shown on the business's financial statements. This means that the business is treated as a separate legal entity from its owners, and any transactions or financial activities related to the business should be reported separately from personal financial activities.

The Separate Entity Concept Requires That