Multiple choice

The dictum that 'Business unit is separate and distinct from the person who supplies capital to it', is based on

  1. money measurement concept

  2. going concern concept

  3. entity concept

  4. dual aspect concept
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The business entity concept (or entity concept) states that a business is a separate and distinct economic unit from the person who owns or supplies capital to it. This means personal transactions of the owner must be kept separate from business transactions, and the business has its own identity for accounting purposes.

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