![kayadaniels2](/avatars/6110.jpg)
kayadaniels2
03.01.2020 •
Business
Michael mcnamee is the proprietor of a property management company, apartment exchange, near the campus of pensacola state college. the business has cash of $8,000 and furniture that cost $9,000 and has a market value of $13,000. the business debts include accounts payable of $6,000. michael's personal home is valued at $400,000, and his personal bank account has a balance of $1,200. identify the principle or assumption that best matches the situation:
Solved
Show answers
More tips
- C Computers and Internet Can You Insert a Regular SIM Card into an iPad? Let s Find Out...
- F Food and Cooking Лечо: вкусное и простое блюдо для любой кухни...
- H Health and Medicine Relieving Swelling in Legs: Causes and Ways to Alleviate the Symptom...
- S Style and Beauty How to Get Rid of a Bruise: Tips and Tricks...
Answers on questions: Business
- S Social Studies Hillary is recalling details from her most recent trip to an amusement park. in the context of the brain structures involved in long-term memory, which lobe of hillary s brain is...
- P Physics Dos masas están conectadas por una cuerda que correo sobre una polea sin fricción. La masa 1 es de 25kg. Y está sobre el plano inclinado a 30 grados, y la masa 2 es de 18kg suspendida...
Ответ:
A) Economic Entity Assumption
B) Cost Principle
C) Monetary unit assumption
D) Going concern assumption
Explanation:
A) As the business properties (Apartment Exchange) are separated from personal assets by not recording those personal assets in the balance sheet, it is the economic entity assumption. Economic Entity Assumption refers to the state that the properties of owners should be separated from the business properties.
B) The company records furniture in the balance sheet at the cost of $9,000 instead of the market price of $13,000. It is an example of the cost principle. Cost principle states that the cost price of an asset should be recorded in the balance sheet at the time of purchasing the asset instead of a recent or market price.
C) As the company records its financial statements in U.S. dollars, it matches with the monetary unit assumption. According to the monetary unit assumption, business corporation's transactions are expressed through a monetary value of that country's currency. Here, Apartment Exchange company's transactions are measured and expressed through a specific currency, and it is a reliable unit.
D) As Michael expects the company to remain in operations for the foreseeable future, it is the assumption of the going concern assumption. According to the going concern assumption, a company will continue to operate in the market for the foreseeable future. It may only stop only when the owners want to liquidate their assets.
Ответ: