Valuation of fixed asset based on which concept
Answers
Answer:
Asset valuation plays a key role in finance and often consists of both subjective and objective measurements. The value of a company's fixed assets – which are also known as capital assets or property plant and equipment – are straightforward to value, based on their book values and replacement costs.
Explanation:
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Answer:
Valuation of the fixed asset is based on the concept of replacement cost as well as book value and going concern.
Explanation:
An organization seeks to employ fixed assets over the long term to help create income. Asset appraisal is a crucial aspect of finance and frequently includes both subjective and objective measurements. Fixed assets, sometimes referred to as capital assets, property, plant, and equipment, are easy to value because they are based on their book value per share and replacement costs.
The idea of a "going concern" presumes that a company will continue to operate indefinitely, or for a considerable amount of time, and won't be liquidated any time soon. As the foundation for displaying the value of a statement of financial position, this accounting tenet is crucial.
On the other hand, this implies that the corporation won't have to immediately stop operations and sell off its assets at what might be low fire-sale prices.