Question

According to this concept, a business firm is treated as a unit separate and distinct from its owners.

Options

• Money measurement concept

• Accounting period concept

• Business entity concept

• Realisation concept

Answer 1

Business entity concept

Explanation:

According to the business entity concept, a business is treated as a separate and distinct unit from its owners. This means that the business's financial transactions are recorded separately from the personal transactions of the owners. This concept ensures clarity and accuracy in financial reporting by keeping the business's financial activities distinct from those of its owners.