Final answer:
In business ownership, an entity's debt does not affect the owner's basis.
Step-by-step explanation:
Debt is a liability that a business entity owes to external parties. In the context of business ownership, an owner's basis refers to the amount of investment or capital they have in the business. The question states that the entity's debt does NOT affect the owner's basis. This means that any debts incurred by the business will not change the owner's initial investment in the business or the value they have in the business.