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JAMB Principles of Accounts 1997 Question 2

Question 2

Accounting Concepts and Conventions

In preparing accounting records, the owners of a business and the business are treated as

  1. A.the same person
  2. B.having business relationship
  3. C.separate legal entities
  4. D.partners.
Show the answer and explanation

Answer: C (separate legal entities)

Explanation

The business entity concept treats the business as separate from its owners in the accounts.