Which Accounting Concept Relates to the Extent to Which Information

question 20

Multiple Choice

Which accounting concept relates to the extent to which information can be omitted, misstated or grouped with other information without misleading the users of that information in their decision-making?

• A) Verifiability
• B) Relevance
• C) Materiality
• D) Economic substance

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Definitions:

Specific Performance

A legal remedy where a court requires a party to fulfill their obligations under a contract, rather than providing a financial compensation.

Guarantee Agreement

A legal contract in which one party agrees to be responsible for another's financial obligations or performance under a contract if the latter fails to meet their obligations.

Loan Agreement

A contract between a borrower and lender, specifying the loan's terms, repayment schedule, and interest rate.

Statute of Frauds

A legal concept that requires certain types of contracts to be in writing and signed by all parties involved to be enforceable.