If Assets Are to Be Valued at Other Than Cost

question 19

Multiple Choice

If assets are to be valued at other than cost, accounting standard IAS 16/AASB 116, Property, Plant and Equipment, requires what basis of valuation to be used?

• A) Market value
• B) Fair value
• C) The lower of cost and net realisable value
• D) No basis of valuation is specified

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Definitions:

Payout

The process of distributing funds by foundations and trusts to meet legal requirements or fulfill their mission.

Accrual Basis

An accounting method where revenue and expenses are recorded when earned or incurred, regardless of when cash transactions occur.

Expenditures

The action of spending funds or an amount of money spent on a particular purpose, product, or service.

Long-Term Solvency

The ability of an organization or business to meet its long-term financial obligations and continue operations into the future.