CA Inter P1 · Chapter 1 · Question 8 of 8
Under the ICAI Framework, assets carried at the amount of cash or cash equivalents that would have to be paid if the same or an equivalent asset were acquired currently are measured on which basis?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Current cost
Explanation
Current cost measures assets at the amount that would be paid to acquire the same or an equivalent asset currently. Historical cost uses the amount paid at acquisition, realisable value uses the amount obtainable by selling the asset in an orderly disposal, and present value discounts the future net cash inflows the asset is expected to generate.
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