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CA Final Ind AS 113 Fair Value Measurement — practice questions

Explore 84 free Ind AS 113 Fair Value Measurement questions in CA Final Financialreporting. Open each question or exercise to read its content, reference answers and available explanation.

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Ind AS 113 Fair Value Measurement questions and exercises with answers

Showing questions 1–30 of 84.

Ind AS 113 fair value is which kind of measurement?Read the answer and worked solution →Fair value under Ind AS 113 is an exit price. What does this mean?Read the answer and worked solution →A company plans to hold a bond until maturity. How does its intention affect fair value under Ind AS 113?Read the answer and worked solution →Which is an objective of Ind AS 113?Read the answer and worked solution →Ind AS 102 share-based payments are treated how by Ind AS 113?Read the answer and worked solution →Net realisable value in Ind AS 2 is, for Ind AS 113,Read the answer and worked solution →Which Ind AS 36 measure is outside Ind AS 113 scope?Read the answer and worked solution →Ind AS 113 disclosures are not required for plan assets under which standard?Read the answer and worked solution →Fair value is the price to sell an asset in which kind of transaction?Read the answer and worked solution →Does the Ind AS 113 framework cover subsequent measurement too?Read the answer and worked solution →Which asset characteristic is considered if buyers would price it?Read the answer and worked solution →Sale restrictions on an asset affect fair value whenRead the answer and worked solution →Which can be the unit measured at fair value?Read the answer and worked solution →Fair value assumes the sale takes place in which market first?Read the answer and worked solution →To identify the principal market, an entity mustRead the answer and worked solution →Absent evidence, which market is presumed principal?Read the answer and worked solution →What access must an entity have to the principal market?Read the answer and worked solution →Two entities trade a commodity in different markets. What follows?Read the answer and worked solution →No observable market exists at the measurement date. Fair value assumesRead the answer and worked solution →Market participants are assumed to act in theirRead the answer and worked solution →When developing market participant assumptions, an entity is required toRead the answer and worked solution →Transaction costs are treated how in a fair value measurement under Ind AS 113?Read the answer and worked solution →Transaction costs are accounted for underRead the answer and worked solution →Why are transaction costs not adjusted in the fair value price?Read the answer and worked solution →A commodity sells for Rs 100 in its principal market. Transport costs Rs 2 and transaction costs Rs 3. Fair value?Read the answer and worked solution →Principal market price is Rs 80 (other market Rs 90). Transport Rs 6, transaction costs Rs 4. Fair value?Read the answer and worked solution →Transport costs are classified under Ind AS 113 asRead the answer and worked solution →Fair value of a non-financial asset reflects a market participant's ability to generate benefits from the asset'sRead the answer and worked solution →Which is NOT a test of highest and best use for a non-financial asset?Read the answer and worked solution →Zoning regulations applicable to a property are an example of which highest and best use test?Read the answer and worked solution →

Worked practice questions

Ind AS 113 fair value is which kind of measurement?

  1. Entity-specific
  2. Management-set
  3. Historical cost
  4. Market-based
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Correct answer: D. Market-based

Fair value looks at what market participants would pay or receive, so it is market-based and not tied to the reporting entity's own circumstances.

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Fair value under Ind AS 113 is an exit price. What does this mean?

  1. Price paid to buy the asset
  2. Price at which the asset is scrapped
  3. Price received to sell the asset
  4. Price set by the entity's board
Show answer and solution

Correct answer: C. Price received to sell the asset

An exit price is the amount received on selling an asset or paid to transfer a liability, viewed from a market participant's side.

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A company plans to hold a bond until maturity. How does its intention affect fair value under Ind AS 113?

  1. It raises the fair value
  2. It lowers the fair value
  3. It moves it to Level 3
  4. It is not relevant
Show answer and solution

Correct answer: D. It is not relevant

Fair value uses market participant assumptions, so the holder's own plan to hold or settle does not change the measurement.

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More Financialreporting topics

Ind AS 116 LeasesInd AS 36 Impairment of Assets and Ind AS 38 Intangible AssetsInd AS 24 Related Party Disclosures and Ind AS 108 Operating SegmentsInd AS 1 Presentation of Financial StatementsInd AS 12 Income TaxesInd AS 109 Financial InstrumentsInd AS 23 Borrowing Costs and Ind AS 40 Investment PropertyInd AS 103 Business Combinations