📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

    Question

    The concept of 'Substance over Form' implies

    that:
    A Legal form of a transaction is more important Correct Answer Incorrect Answer
    B Accounting treatment should reflect the economic reality Correct Answer Incorrect Answer
    C Transactions should be recorded based on their legal form only Correct Answer Incorrect Answer
    D Form of the transaction dictates the substance Correct Answer Incorrect Answer
    E It is a principle of taxation Correct Answer Incorrect Answer

    Solution

    The "Substance Over Form" concept is a key accounting principle that states transactions and events should be accounted for and presented in accordance with their economic reality and financial substance, not merely their legal form. This prevents financial statements from being misleading.

    Practice Next
    More Accounts Questions
    ask-question