AASB 138 permits two bases for measuring intangible assets,subsequent to initial recognition,the cost model and the revaluation model:
A) in practice the revaluation model is the one that is most commonly applied
B) the conditions for the use of the revaluation model will only be met on rare occasions
C) in practice the two models are applied about 50/50
D) none of the above

Question

Quizplus · Accepted Answer

The conditions for the use of the revaluation model, such as the existence of an active market, are generally not met for intangible assets, therefore the cost model is usually the most applicable method. Hence, choice A is incorrect. Choice C is also incorrect since the use of the revaluation model for intangible assets is not as prevalent as the cost model.

AASB 138 Permits Two Bases for Measuring Intangible Assets,subsequent to Initial