Theoretical FrameworkQ-3 | Accounting as a Measurement DisciplineQuestion 4983 of 110
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Realisable Value

Options

A
B
C
D
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Correct Answer

✅ Option — Correct Option

All Options:

  • A
  • B
  • C
  • D

Detailed Solution & Explanation

### Realisable Value: * As per realisable value, assets are carried at the amount of cash or equivalent that could currently be obtained by selling the assets in an orderly disposal. Haphazard disposal may yield something less. * Liabilities are carried at their settlement values; ie, the undiscounted amounts of cash or cash equivalents expressed to be paid to satisfy the liabilities in the normal course of business.
### Example: (1) Suppose 'Ram' found that he can get 14,00,000 if he would sell the building purchased on 1.1.2005. So the building should be recorded at 14,00,000 the realisable value in an orderly sale.
(2) Take also that 'Ram' found that he had no money to pay off the bank loan currently and will pay in the normal course. So the bank loan should be recorded at ₹ 4,00,000 the settlement value in the normal course of business.

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