Multiple choice

The owner of a company included his personal medical expenses in the company's income statements. Indicate the accounting principle that is violated.

  1. Cost principle

  2. Going concern concept

  3. Entity concept

  4. Conservatism
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The business entity concept states that the business and its owners are separate legal and accounting entities. Personal expenses of the owner should not be mixed with business expenses.

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