A company's assets are differentiated from the senior manager's.What assumption/concept underlies this procedure?
A) Accounting entity
B) Monetary
C) Historical cost
D) Going concern

Question

Quizplus · Accepted Answer

The accounting entity assumption states that a company's financial transactions must be kept separate from the personal financial transactions of its owners or managers. This principle ensures that a company's assets, liabilities, and equity are recorded and reported accurately on its financial statements, which are used by investors and stakeholders to assess the company's financial health and performance. As a result, it is essential to differentiate a company's assets from the senior manager's in order to properly record and report the company's financial transactions.

A Company's Assets Are Differentiated from the Senior Manager's