Where an asset is measured at fair value, the figure involved:
A) is more likely to be reliable if a liquid market for the asset exists than if no liquid market exists.
B) reflects an historical value.
C) is the same as replacement cost.
D) is fair and reasonable.

Question

Quizplus · Accepted Answer

The fair value of an asset is more likely to be reliable if there is a liquid market for the asset, as this allows for a more accurate valuation based on market activity. Without a liquid market, fair value measurements may be based on estimates and assumptions, which could decrease reliability.

Where an Asset Is Measured at Fair Value, the Figure