The Separate Entity Assumption

question 142

Multiple Choice

The separate entity assumption:

• A) requires periodic income measurement.
• B) is applicable to both incorporated and unincorporated businesses.
• C) is not applicable to an unincorporated business.
• D) recognizes the legal nature of a business organization.

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Definitions:

Intercostals

Muscles situated between the ribs that play a role in the mechanics of breathing.

Apices of Lungs

The uppermost parts of the lungs, situated near the clavicle (collarbone).

Clavicles

Long, thin bones that serve as a strut between the shoulder blade and the sternum or breastbone, commonly referred to as collarbones.

Midclavicular Line

An imaginary vertical line that runs through the midpoint of the clavicle in a person's anatomical position.