A crucial question concerning income is when to recognize it (in which accounting period income should income be taxed?). Which of the following help resolve the problems of timing?
I.Realization Concept.
II.Accounting Method.
III.Constructive Receipt.
IV.Substance-Over-Form Doctrine.

Question

A crucial question concerning income is when to recognize it (in which accounting period income should income be taxed?). Which of the following help resolve the problems of timing?
I.Realization Concept.
II.Accounting Method.
III.Constructive Receipt.
IV.Substance-Over-Form Doctrine.
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Quizplus · Accepted Answer

The Realization Concept, Accounting Method, and Constructive Receipt are all principles or methods that help in determining the timing of income recognition for taxation purposes. The Realization Concept dictates that income is recognized when it is earned, regardless of when the cash is received. The Accounting Method (such as cash or accrual basis) determines when transactions are recorded and recognized as income. Constructive Receipt indicates that income is recognized when it is made available to a taxpayer, even if not physically in possession. The Substance-Over-Form Doctrine, while important in determining how transactions are taxed, does not directly address the timing of income recognition.

A Crucial Question Concerning Income Is When to Recognize It