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 underlying the division of a business's life into equal periods is the accounting period concept. This concept assumes that the economic activities of a business can be separated into artificial time periods, such as months or years, to help determine the financial performance of the business during that period.

The Life of a Business Is Divided into Equal Periods