Mason Olson is chairman of the board of Healthy Fast Foods, Inc. Suppose Olson has just founded Healthy Fast Foods, and assume that he treats his home and other personal assets as part of Healthy Fast Foods. Answer these questions about the evaluation of Healthy Fast Foods, Inc.
1. Which accounting assumption governs this situation?
2. How can the proper application of this accounting assumption give Olson and others a realistic view of Healthy Fast Foods, Inc.? Explain in detail.