The correct answer is: C. Separate business entity concept.
The separate business entity concept is a fundamental accounting principle that states that a business is a separate entity from its owners. This means that the business’s financial statements should reflect only the business’s activities, and not the personal activities of its owners.
When an owner allocates their private expenses to their business, they are essentially mixing the business’s finances with their own. This violates the separate business entity concept, and can make it difficult to determine the true financial performance of the business.
The accrual concept is the accounting principle that states that revenue should be recognized when it is earned, and expenses should be recognized when they are incurred. The matching concept is the accounting principle that states that expenses should be matched with the revenues they generate. The consistency concept is the accounting principle that states that a company should use the same accounting methods from period to period.
While these principles are important, they do not apply to the situation described in the question. The allocation of owner’s private expenses to his/her business is a violation of the separate business entity concept, and not any of the other three principles.