The accounting convention that requires the activities of the business to be kept separate from the activities of the owner is the:
A)dual aspect convention.
B)business entity convention.
C)conservatism convention.
D)accounting period convention.

Question

Quizplus · Accepted Answer

The business entity convention requires that the activities of the business and the owner be kept separate for accounting purposes. This means that the business is treated as a separate entity from its owner and its financial transactions are recorded independently. This convention helps to provide clarity and transparency in financial reporting and ensures that the business accounts accurately reflect the financial position of the business itself, rather than being distorted by personal transactions of the owner.

The Accounting Convention That Requires the Activities of the Business