5. The economic entity assumption requires that the activities of an entity be kept separate and distinct from the activities of its owner and all other economic entities.

6. Owners' claims to total business assets take precedence over the claims of creditors because owners invest assets in the business and are liable for losses.

7. The principal source of equity is amounts paid in by shareholders.

8. The purchase of office equipment on credit increases total assets and total liabilities.

9. The ending retained earnings balance is reported on the statement of financial position.

Required: State whether each statement above is TRUE or FALSE.