Concept:When the going concern assumption fails, the business is expected to close down, so assets are valued at what they can be sold for, not at continued-use values.
Explanation:Under the going concern concept, fixed assets are kept at cost less depreciation because the business will use them for a long time.
If this concept is no longer valid, it means the business is unlikely to continue operations.
Therefore, fixed assets should be recorded at the amount they would fetch if sold immediately.
That amount is known as realizable value.
Net book value and gross value are based on continued use, not on forced sale, so they are not appropriate.
Revalued amount is an internal estimate, not necessarily the actual sale value.
Answer:The fixed assets are recorded at their
realizable value.
Correct option:
B. realizable value.