Which of the Following Would Violate the Economic Entity Concept

question 149

Multiple Choice

Which of the following would violate the economic entity concept?

• A) reporting amounts owed to the company's suppliers as a liability on the balance sheet.
• B) reporting equipment owned and used in the business as an asset in the balance sheet.
• C) reporting withdrawals by the owner as a drawing in the statement of owner's equity.
• D) reporting the owner's personal sailboat as an asset on the balance sheet.

---

Definitions:

Laws

The system of rules that a particular country or community recognizes as regulating the actions of its members and may enforce by the imposition of penalties.

Facial Expressions

The movements of the muscles beneath the skin of the face, conveying emotions, reactions, or intentions.

Teamwork

The collaborative effort of a group to achieve a common goal or complete a task in the most effective and efficient way.

Individualism

A principle favoring freedom and self-expression over collective or state control.