Bill Rogers Has Three Different Businesses

question 48

Multiple Choice

Bill Rogers has three different businesses.He has only one bank account for transactions relating to all of his various businesses.Which of the following concepts or principles of accounting is Bill violating?

• A)Entity concept
• B)Accounting period concept
• C)Accrual basis accounting
• D)Going concern concept

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Definitions:

Sales Returns & Allowances

Sales Returns & Allowances account for the reduction in sales due to products being returned or allowances provided for damaged goods.

Merchandise Inventory

Goods that a business holds for the purpose of selling to customers, often part of the current assets on a company's balance sheet.

Periodic

Occurring or recurring at regular intervals, often used to describe payments, reviews, or assessments.

Freight-In

A cost of goods sold account that records the shipping cost to the buyer.