The reason that the revaluation model is NOT widely used for measuring intangible assets after initial recognition is that
A) it is not allowed under IFRS.
B) the cost method is easier to use.
C) it can be applied only to intangible assets with a fair value determined in an active market.
D) it requires an extensive internal investigation to determine fair value.

Question

Quizplus · Accepted Answer

The revaluation model can only be applied to intangible assets with a fair value that can be determined in an active market. As many intangible assets do not have an active market, the revaluation model is not widely used. The cost method is often used instead as it is easier to use and does not require determining fair value. The revaluation model is allowed under IFRS, but its application is limited. Additionally, it may require an extensive internal investigation to determine fair value, but this is not the main reason why it is not widely used.

The Reason That the Revaluation Model Is NOT Widely Used