In estimating the fair value of the land, the company should consider the highest and best use of the land. The highest and best use is the use of an asset that maximizes its value, considering the use that is physically possible, legally permissible, and financially feasible. The Financial Accounting Standards Board (FASB) in its Accounting Standards Codification (ASC) 820, Fair Value Measurement, defines fair value as "the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date." In this context, the highest and best use of the land would be determined by what a market participant would use the land for to maximize its value. If using the land as a parking lot would generate more value than using it to grow corn, then the fair value of the land should be estimated based on its use as a parking lot. The use that meets all these criteria and generates the highest value is considered the highest and best use, and the fair value of the land should be estimated based on this use. Sources: - FASB ASC 820, Fair Value Measurement