Review the statements given below. Each statement represents one of the key assumptions of the accounting model. Identify which assumption is applicable and describe your response. Account Assumptions Accrual Conservatism Consistency Economic Entity Going Concern Relevance/Reliability Time Period.

Sunshine Aviation buys licenses for its pilots every year. Sunshine usually has to buy at least 10 licenses that cost $5,000 per license. Sunshine capitalizes these licenses and amortizes them in the years they do not need a deduction and he expenses them in the years that he needs a tax deduction.

The owner of a company personally acquires an office building, and rents space in it to his company at $3,000 per month. This rent expenditure is a valid expense to the company, and is taxable income to the owner.

A company attaches the source document to the journal entry

Answer rating: 100% (QA)

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