The earth moving equipment that your uncle applies in his business was purchased during 2017 for R1 300 000. The accountant determined that the present value of future cash flows from the use of the assets, minus possible expenses related to these items amounted to R1 050 000. The cost of equivalent assets of this exact nature today as per the latest catelogues is R1 200 000 and a business in the neighbouring town offerred your uncle R1 400 000 for the equipment which cannot be imported under current lockdown restrictions.

Match the values from the scenario above with the correct measurement bases:

historical cost :

Fair value :

Current cost :

Value in use :

You have purchased this laptop three years ago for R20 000 to apply in your tuck shop which you operate out of your flat to sell snacks to fellow students during exam time. You are in the process of applying for a small personal loan and The Bank has requested values for your assets to determine your eligibility for the amount that you wish to obtain. You can sell the laptop for R15 000 online on Gumtree and confirmed with the local second hand IT shop that another laptop with the same specifications will cost R16 500.

The R15 000 will be classified as which measurement option:

1. Historical cost / 2. Fair value / 3. current cost / 4. value in use

Your brother purchased a motorcycle without wheels for R51792. To fit the wheels he paid an additional R9139. One year later he had to repair some electrical wiring at a cost of R3690 and the mechanic that worked on the motorcycle offered to buy it from your brother for R65169.

Calculate the Historical cost of the motorcycle.

Answer rating: 100% (QA)

1 Earth Moving Equipment Historical cost This is the original cost of acquiring the equipment which ... View the full answer