12. The fair value hierarchy classifies inputs into different levels. Define each of these levels.

13. Complete the following table by indicating the level of input according to the fair value hierarchy

Item Level ?

a. Intangible asset

b. Debt of a large multinational traded on many worldwide exchanges

c. Debt of an Asian corporation, not widely traded, but with the debt following the benchmark treasury values of the country of origin

d. Private-equity investment

e. Over-the-counter derivative with value based on an observable LIBOR interest rate

f. Common stock traded on the NASDAQ

14. What is the order of priority of the following measurements for determining the fair value of a financial liability? a. Quoted price in an active market for the identical liability held by another party as an asset b. Quoted price in an active market for similar liabilities c. Quoted price in an inactive market for the identical liability held by another party as an asset d. Quoted price in an active market for the identical liability

15. The disclosures related to fair value measures are designed to provide users of financial statements with: a. Amount and classification of fair value assets and liabilities as of the balance sheet date b. Amount and classification of fair value measures as of the balance sheet date as well as the amounts of the changes in fair value measures during the period c. Extent to which fair value is used to measure assets and liabilities at the measurement date, the valuation techniques, inputs and assumptions used to measure fair value and the effect of fair value measures on operations d. Description of how fair value is determined and the effects of changes in assets and liabilities, measured through fair value, during the period.

16. The Mountain View Company acquired a piece of land in a business combination transaction from the Valley View Company, an unrelated company. The land originally cost $4 million when purchased by Valley View. The fair value of the land has subsequently been measured by Mountain View for two different purposes, one as a site for a shopping center and one as a site for a drive-in movie theater. The shopping center fair value was estimated to be $10 million and the drive-in movie theater fair value was estimated to be $5 million. What is the premise that Mountain View should use in fair valuing the land and what is the corresponding amount? a. Management intention premise at $7.5 million b. Ease to market premise of $5 million c. Carryover of initial cost basis of $4 million d. Highest and best use premise of $10 million