A proprietor is an individual who owns a business establishment or sole proprietorship. This person has legal use of the assets and their operations. Concept of Business Entity:The concept of business entity assumes that business has a distinct and separate entity from its owners. It means that for the purposes of accounting, the business and its owners are to be treated as two separate entities. Keeping this in view, when a person brings in some money as capital into his business, in accounting records, it is treated as a liability of the business to the owner. Here, one separate entity (owner) is assumed to be giving money to another distinct entity (business unit). Similarly, when the owner withdraws any money from the business for his personal expenses (drawings), it is treated as a reduction of the owners capital and consequently a reduction in the liabilities of the business. Hence, according to the Entity concept, the proprietor is treated as a creditor to the extent of his capital. 1. Cost concept:The cost concept of accounting states that all acquisition of items (such as assets or things needed for expending) should be recorded and retained in books at cost. Thus, if a balance sheet shows an asset at a certain value it should be assumed that this is its cost unless it is categorically stated otherwise. 2. Money measurement concept:The money measurement concept (also called monetary measurement concept) underlines the fact that in accounting and economics generally, every recorded event or transaction is measured in terms of money, the local currency monetary unit of measure. 3. Dual aspect concept:According to the Dual Aspect Concept, each business transaction has a dual or a two-way effect. This implies that a particular business transaction involves a minimum of two accounts when recorded in the books of accounts. This principle is the foundation of the Double Entry System of accounting.