Questions: Knowledge Check 01 Identify the correct assumption for each of the following activities using the drop-down list. - Presumes that the business will continue operating in the future. - A business is accounted for separately from other business entities and its owner. - Transactions and events are expressed in units of money. - The life of the company can be divided into specific time periods.

The answer is as follows:

This is the Going Concern Assumption. It assumes that the business will continue to operate and not liquidate in the foreseeable future.

This is the Business Entity Assumption. It ensures that the business's financial information is recorded and reported separately from the owner's personal financial information and other businesses.

This is the Monetary Unit Assumption. It states that only transactions and events that can be measured in monetary terms are recorded in the financial statements.

This is the Time Period Assumption. It allows the business to report its financial performance and position over specific periods, such as months, quarters, or years.