PRC-1 · Chapter 6 · Question 33 of 100
Which of the following statements about 'Residual Value' is completely correct according to IAS 16?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) It is the estimated amount currently realizable from disposal, assuming the asset is already of the age and condition expected at the end of its useful life.
Explanation
IAS 16 defines residual value based on current prices, essentially estimating what the asset would fetch today if it were already in the condition expected at the end of its useful life, less disposal costs.
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