BU387 Chapter 2A: BU 387 Chapter 2A: 3
Document Summary
Fair value measurements: when measuring fair value, consider the following, nature, condition and location of asset, valuation premise: generally value the asset based on highest and best use, regardless of actual use, principal market: value based on the most advantageous market, valuation technique: inputs for the valuation model. Terminology: event: the cause of changes of assets, liabilities and equity, transaction: a transfer or exchange between 2 or more entities or parties, account: where transactions are recorded, a separate account is used for each asset, liability, revenue, expense, gain, loss and capital (owner"s equity, permanent accounts: real accounts, asset, liability and equity accounts, appear on the balance sheet, permanent accounts are not closed at year end, temporary accounts: (nominal, revenue, expense and dividend accounts, revenue and expenses are on the income statement; dividends are on the statement of changes in shareholder"s equity, temporary accounts are closed at year end.
