The financial activities of a business and the financial activities of the owners should be
A)combined only if the owner wants them to be.
B)kept totally and completely separate.
C)combined in the firm's accounting records.
D)reported in different parts of the firm's accounting records.

Question

Quizplus · Accepted Answer

The financial activities of a business and the financial activities of the owners should be kept totally and completely separate. This is because the business is a separate legal entity from its owners, and its financial transactions should reflect only the activities of the business. Mixing personal and business finances can lead to confusion, accounting errors and even legal problems. It is essential for business owners to maintain separate bank accounts, credit cards and accounting records to keep their personal and business finances separate.

The Financial Activities of a Business and the Financial Activities