AASB 116 provides guidance on fair values which states:
A) Where an active and liquid market exists for an asset, the market price represents evidence of the asset's fair value.
B) Fair values are determined on the basis that an entity is a going concern.
C) Where no market exists the price should be based on the amount for which an asset could be exchanged between knowledgeable, willing parties in an arm's length transaction.
D) All of the given answers are correct.

Question

Quizplus · Accepted Answer

AASB 116 stipulates that fair value should reflect the market price in an active and liquid market, assumes the entity is a going concern, and in the absence of a market, it should be based on an arm's length transaction between knowledgeable, willing parties.

AASB 116 Provides Guidance on Fair Values Which States