The life of a business is divided into equal periods to determine profit or loss for that period.What assumption/concept underlies this procedure?
A) materiality
B) monetary
C) accounting period
D) accounting entity.

Question

Quizplus · Accepted Answer

The concept of accounting period assumes that the life of a business can be divided into equal and distinct time periods, usually a year or a quarter, to determine the financial performance of the business during that period. This allows for comparison of financial statements from one period to another, and facilitates analysis and decision-making for stakeholders.

The Life of a Business Is Divided into Equal Periods