Indicate which accounting principle(assumption) correctly suits the statementgiven in each item. | Homework 1.pdfATION, Indicate which accounOpen with(assumption) correctly suits the statementgiven in each item.1. This concept supports the separation of the business assets and liabilities fromthe personal assets and liabilities of the owner.2. St. Luis University starts its fiscal year June and ends in May. The accountantreceived its utilities bill for the month of May from Maynilad. Since this will bepaid on the second week of June, the accountant recorded it as expensesunder the month it was paid.3.A logging company was permitted to cut trees in Negros Oriental. The loggingcompany did not keep any accounting records of its transactions which is thereason why yearly income/loss cannot be determined. The logging companystated it will determine its net income/loss after cutting all the trees in the areawhich will take more than ten years from now.Electric bill for the month in the amount of P15,000 was received by Rock LeeCompany on December 30. The accountant did not record this since it will bepaid January 10 next year when the company resumes operations after theholidays.4.5.An old private school in the community assumes that their school will closeanytime due to stiff competition despite its good name. The accountingrecords are maintained based on this assumption.Mr. Otto Hahn founded Saints Enterprises. He treated his residence and otherpersonal assets as part of Saints Enterprises.6.7. Ste Benjamin's Hospital has been serving the community for twenty years.However, since new hospitals such as Saint Look's Medical Center andMetropolitan City Medical Center have opened in the area, St. Benjamin'sHospital felt the stiff competition. The stockholders are suggesting upgradingthe hospital's equipment and infusing more capital. However, themanagement of St. Benjamin's declines the proposal because of the beliefthat the hospital will lose the competition and that it is ready to stopoperations anytime to avoid losses. Hence, the accounting department isoperating based on this assumption.8.Giselle Ong owns Magnificent Gel's Candle Shop. She proposes to accountfor the shopk assets at current market value in order to have realistic amountsen the books hould she decideo liquidate the business anytime.Page9. Niko Ong Developers cot a contract to develop the five-hectare Flora HeightsSubdivision on Januar this vear. At the end of the vear. Niko Ona Developers.

1. Business entity concept 2. Realization concept 3. Money measurement concept 4. Accrual accounting…

Answered: Indicate which accounting…

Business

Accounting

Indicate which accounting principle(assumption) correctly suits the statement given in each item.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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