Michael McNamee is the proprietor of a property management company, Apartment Exchange, near the campus of Penscola State College. The business has cash of $8,000 and furniture that cost $9,000 and has a market value of $13,000. The business debts include accounts payable of $6,000. Michael's personal home isvalued at $400,000, and his personal bank account has a balance of $1,200. Identify the principle or assumption that best matches the situation:а.Michael's personal assets are not recorded on the Apartment Exchange's balance sheet.b.The Apartment Exchange records furniture at its cost of $9,000, not its market value of $13,000.The Apartment Exchange reports its financial statements in U.S. dollars.c.d.Michael expects the Apartment Exchange to remain in operations for the foreseeable future.a. Michael's personal assets are not recorded on the company's balance sheet:b. The company records furniture at its cost of $9,000, not its market value of $13.000:c. The company records its financial statements in U.S. dollars:d. Michael expects the company to remain in operations for the foreseeable future:

Economic Entity Assumption The "Economic entity assumption" provides that all the activities of the…

Michael McNamee is the proprietor of a property management company, Apartment Exchange, near the campus of Penscola State College. The business has cash of $8,000 and furniture that cost $9,000 and has a market value of $13,000. The business debts include accounts payable of $6,000. Michael's personal home is valued at $400,000, and his personal bank account has a balance of $1,200. Identify the principle or assumption that best matches the situation: a. Michael's personal assets are not recorded on the Apartment Exchange's balance sheet. The Apartment Exchange records furniture at its cost of $9,000, not its market value of $13,000. The Apartment Exchange reports its financial statements in U.S. dollars. d. Michael expects the Apartment Exchange to remain in operations for the foreseeable future. . Michael's personal assets are not recorded on the company's balance sheet: p. The company records furniture at its cost of $9,000, not its market value of $13,000: . The company records its financial statements in U.S. dollars: 1. Michael expects the company to remain in operations for the foreseeable future:

Michael McNamee is the proprietor of a property management company, Apartment Exchange, near the campus of Penscola State College. The business has cash of $8,000 and furniture that cost $9,000 and has a market value of $13,000. The business debts include accounts payable of $6,000. Michael's personal home is valued at $400,000, and his personal bank account has a balance of $1,200. Identify the principle or assumption that best matches the situation: a. Michael's personal assets are not recorded on the Apartment Exchange's balance sheet. The Apartment Exchange records furniture at its cost of $9,000, not its market value of $13,000. The Apartment Exchange reports its financial statements in U.S. dollars. d. Michael expects the Apartment Exchange to remain in operations for the foreseeable future. . Michael's personal assets are not recorded on the company's balance sheet: p. The company records furniture at its cost of $9,000, not its market value of $13,000: . The company records its financial statements in U.S. dollars: 1. Michael expects the company to remain in operations for the foreseeable future:

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter2: Income Tax Concepts

Section: Chapter Questions

Problem 25P

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