Question
Narok Ltd acquired equipment as part of a business combination but is unsure what value to record for the equipment. It isestimated that the net
Narok Ltd acquired equipment as part of a business combination but is unsure what value to record for the equipment. It isestimated that the net present value of future cash flows generated by the equipment is $15,000. The cost of replacing the equipment is estimated to be $18,000. The equipment has been independently appraised as having a market value of $14,000. In the books of the acquired company, the carrying amount of the equipment was $19,000.The value at which the equipment will be recognised when recording the business combination is:
$14,000
$15,000
$18,000
$19,000
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