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31 August, 14:00

Marsha Bogswell is the sole stockholder of Bogswell Legal Services.

Which accounting principle requires Marsha to keep her personal financial information separate from the financial information of Bogswell Legal Services?

a. Monetary unit assumption.

b. Going-concern assumption.

c. Measurement (Cost) principle.

d. Business entity assumption.

e. Expense recognition (Matching) principle.

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  1. 31 August, 14:13
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    d. Business entity assumption.

    Explanation:

    Business entity assumption -

    It is an accounting principle,

    According to this principle, the financial statements or any financial records, should be kept far apart from the personal financial records, is referred to as business entity assumption.

    As all the money required for business need to be recorded separately.

    Hence, from the given scenario of the question,

    The correct option is d. Business entity assumption.
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