Which of the following assumptions implies that the assets and liabilities of the business are accounted for separately from the assets and liabilities of the owners?

A. Monetary unit assumption.

B. Continuity assumption.

C. Historical cost principle.

D. Separate entity assumption.

D. Separate entity assumption.

Explanation:

There are various types of assumptions or principle which are described below:

A. Monetary unit assumption: In this assumption, business transactions are expressed in money terms. In another word, it records only those transactions that involve monetary units.

B. Continuity assumption: In this assumption, the business organization is continuing to do its operations in the future. There is no motive to close down the business. It is also known as the going concern principle.

C. Historical cost principle: According to this principle, the assets and liabilities should be recorded on the purchase or acquisition price in the financial statements.

D. Separate entity assumption: In this assumption, the business is separate from its owners. The transactions done by the business is separated from the transactions done by the owners.