BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
Quoted prices in active markets for identical assets that the entity can access at the measurement date.
|
|
|
Quoted prices for similar assets in active markets.
|
|
|
Quoted prices for identical or similar assets in markets that are not active.
|
|
|
Inputs other than quoted prices that are observable for the asset.
|
Detailed explanation-1: -The three widely used valuation techniques cited by IFRS 13 are: market approach, cost approach, and. income approach.
Detailed explanation-2: -12 IFRS 13 states that, when measuring fair value, the objective is to estimate the price at which an orderly transaction to sell an asset or to transfer a liability would take place between market participants at the measurement date under current market conditions (ie to estimate an exit price).
Detailed explanation-3: -An entity shall measure the fair value of an asset or a liability using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.
Detailed explanation-4: -The fair value hierarchy prioritises the inputs to valuation techniques, not the valuation techniques used to measure fair value. IFRS 13 states that only unadjusted quoted prices in active markets for identical assets or liabilities that the entity can access at the measurement date qualify as Level 1 inputs.