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21... the principal concern with accounting for related-party transactions is: a. the size of the transactions. b. differences between economic substance and legal form. c. the absence of legally binding contracts. d. the lack of accurate data to record transactions.
21... the principal concern with accounting for related-party transactions is: a. the size of the transactions. b. differences between economic substance and legal form. c. the absence of legally binding contracts. d. the lack of accurate data to record transactions.
Final answer:The principal concern with accounting for related-party transactions is the differences between economic substance and legal form.Explanation:Theprincipal concernwith accounting for related-party transactions is the differences betweeneconomic substance and legal form.Related-party transactions refer to transactions between two parties that have a pre-existing relationship or connection, such as a parent company and its subsidiary. These transactions may raise concerns about the accuracy and reliability of financial reporting, as there could be a risk of manipulation or improper recording of the transactions.For example, a company may engage in a related-party transaction to transfer assets at below market value to artificially reduce its taxable income. In such cases, the economic substance of the transaction (the true economic impact) may differ from its legal form (the formal recording of the transaction), creating a potential risk for misleading financial statements.Learn more about Accounting here:brainly.com/question/33477032#SPJ11...