Recoverable amount is the:
A) higher of an asset's fair value less costs to sell, and its value in use.
B) amount expected to be received from the disposal of the asset.
C) amount expected to be recovered from the use of the asset.
D) lower of an assets fair value and its net realisable value.

Question

Quizplus · Accepted Answer

Recoverable amount is the higher of an asset's fair value less costs to sell, and its value in use. This is the amount that an entity expects to recover from the asset's use or sale. Therefore, option A is the correct answer. Option B refers only to the amount expected to be received from the disposal of the asset, without including any potential future use. Option C refers only to the amount expected to be recovered from the use of the asset, without considering any sale value. Option D is incorrect as it only includes the lower of an asset's fair value and its net realisable value, which may not reflect the full potential of the asset.

Recoverable Amount Is The