By Permitting Some Classes of Assets to Be Valued at Cost

question 1

Multiple Choice

By permitting some classes of assets to be valued at cost and others at fair value the AASB has:

• A) Removed any confusion regarding the total balance of non-current assets.
• B) Forced entities to accurately reflect their true financial position at any point in time.
• C) Created a situation where the total asset figure may be a combination of cost and fair value assessments, reducing its meaningfulness.
• D) Removed the opportunity for managers to act in their own self-interest as suggested by Positive Accounting Theory.
• E) None of the given answers.

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