Which statement about current value is true?
A)Current value can only be defined one way.
B)An accounting system could be produced based on current value rather than historical cost.
C)The second-hand sale value of an asset is not an example of current value.
D)Current values are based on transactions.

Question

Quizplus · Accepted Answer

Current value can be defined in different ways, such as market value or replacement cost. An accounting system based on current value would rely on up-to-date values rather than historical costs. Option A is incorrect because current value can be defined in different ways. Option C is incorrect because the second-hand sale value of an asset can be an example of current value if it reflects the current market value of the asset. Option D is incorrect because current values can be based on factors such as market conditions, inflation, and changes in supply and demand, in addition to transactions.

Which Statement About Current Value Is True