WAEC Accounting 2014 Objective — Question 27

Question 27 of 50 from the West African Examinations Council (WAEC) Accounting 2014 Objective paper, with the correct answer and a full explanation.

The accounting concept underlying the treatment of personal expenses of the business owner as drawing is

A. periodicity
B. accrual
C. entityCorrect
D. materiality

Explanation

The entity concept states that a business has a distinct existence separate from its owner; hence, withdrawals by the owner are treated as drawings, not business expenses.

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