Home › CS Executive › corpacc › Introduction to Financial and Corporate Accounting › The Business Entity assumption is one of the fou…
The Business Entity assumption is one of the four listed accounting assumptions. Which statement best captures the Business Entity assumption?
Answer & Solution
Correct answer: C.
1. The lesson lists Business Entity as one of four accounting assumptions.
2. The assumption treats the business as separate and distinct from its owners.
3. This separation lets the books record only business transactions.
4. Identity with owners, departmental status and shared PAN do not capture the assumption.
_Source: ICSI CS Executive Paper 5 (Corporate and Management Accounting) — Lesson 1 & 2: Introduction to Financial and Corporate Accounting, pp. v–vii and x._
Related questions
The lesson sketches a nine-step accounting cycle. Which step is described in the cycle as The Time Period assumption is one of the four listed accounting assumptions. Which statemeAccounting Standards (AS) are described in the lesson as written policy documents issued bRevenue Realisation is listed in the lesson as an accounting concept. Under this concept, Consistency is listed by the lesson as one of the accounting constraints. Which statement Full Disclosure is listed by the lesson as one of the accounting concepts. Which statementThe Matching concept is listed by the lesson alongside Revenue Realisation under the broadThe lesson cites Historical Cost as an accounting concept. Which statement best captures t