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Sir, should the new acquired asset is valued at FV rather than the FV of the asset given up if it has commercial substance?
Why PYQ Dec/Sep 2015 Q1 working 5 is measured at FV of the asset given up?
I have look through the Kaplan Kits for this past paper question but no mention on this area, please answer is it the answer is correct?Thank you.
as per IAS 16
“If an asset is acquired in exchange for another asset (whether similar or dissimilar in nature), the cost will be measured at the fair value unless (a) the exchange transaction lacks commercial substance or (b) the fair value of neither the asset received nor the asset given up is reliably measurable. If the acquired item is not measured at fair value, its cost is measured at the carrying amount of the asset given up.”Should it use the FV of the asset given up when only the acquired items cannot be measured at FV?
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