Describes the application of the historical cost concept

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Question - Mark Kurt's Enterprises buys a new stamping machine for €10,000 at an auction held by a company in bankruptcy proceedings. The machine is a very good deal; Mark would have paid about €12,000 to buy it in the open market. Which of the following statements best describes the application of the historical cost concept?

a. Oliver should record the new machine asset for €12,000, the most relevant amount.

b. Oliver should record the new machine asset for €10,000, the most reliable amount.

c. Oliver should record the machine at the average appraised value from at least three appraisers.

d. Oliver should record the new machine asset for €10,000 and immediately record a gain of €2,000.

Reference no: EM133102315

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