BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Business Entity
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Monetary
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Going concern
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Materiality
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Detailed explanation-1: -For example, if a business owner purchases gas for a car personally owned by him using a personal credit card, but uses that gas and car for business travel, then the owner should be reimbursed for those expenses using the standard mileage rate allowed by the Internal Revenue Service (IRS).
Detailed explanation-2: -An example is a sole trader or proprietorship. The sole trader takes money from the business by way of ‘drawings’, money for their own personal use.
Detailed explanation-3: -If the owners take goods from the inventory for their personal use, then it will violate the separate entities’ concept.
Detailed explanation-4: -A corporation is a separate entity. The business registers with a state and keeps its business separate through its transactions and ownership documents. All types of corporations (including S corporations, professional corporations, and professional service corporations) are separate entities.