State the Accounting Assumption, Principle, Information Characteristic or Constraint That

State the accounting assumption, principle, information characteristic or constraint that is most applicable:
1. An officer of Nanuck Inc. purchased a new home computer for personal use with company money, charging miscellaneous expense.

2. A machine, which cost $60,000, is reported at its current market value of $90,000.

3. Nanuck Inc. decides to establish a large loss and related liability this year because of the possibility that it may lose a pending patent infringement lawsuit. The possibility of loss is considered remote by its lawyers.

4. Because the company's income is low this year, a switch from accelerated depreciation to straight-line depreciation is made this year.
5. The president of Nanuck Inc. believes it is foolish to report financial information on a yearly basis. Instead, the president believes that financial information should be disclosed only when significant new information is available related to the company's operations.

Correct Answer:

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1. Separate entity.
2. Histori...

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