Exam 3: Fair Value Measurement

Entity A holds 75% ownership of Entity B's 100,000 shares. For its separate financial statements, Entity A accounts for the shares at fair value under IFRS 9 (meaning that unit of account is each share). For its consolidated financial statements, Entity A accounts for the shares as a cash-generating unit. The quoted price is $10 per share, and there is a $2 control premium per share. What would be the fair value for the separate and consolidated financial statements?

Entity A has an asset that needs to be measured at fair value. The following information is given: a. Value in the principal market - $500 b. Value in the most advantageous market - $550 c. Value in the least advantageous market -$465 What should be the fair value of the asset?

Market participants are buyers and sellers in the principal market for the asset or liability that have all of the following characteristics except:

Fair value is an entity-specific measurement.

Costs that are considered in determining fair value include transformation costs and transportations costs and transactions costs.

What is the cause of a day one gain or loss?

Match the input level with its definition (Level 1, Level 2, or Level 3). -level 3

Entity A hopes to sell a large printing machine that it purchased three years ago. The value at the time of purchase was $80,000. Entity A will need to spend $5,000 to repair the machine to selling conditions and will spend an additional $5,000 in transportation costs. Entity A also will incur a commission of 5% of the sale. The market price for the machine is currently $75,000. What is the fair value that Entity A should measure the machine at?