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Realisable Value

  • Realisable value is the amount of cash or cash equivalent that could currently be obtained by selling the asset in an orderly disposal

Example: Rachna purchased a machine at ₹ 8,00,000 on 01-01-2009. If she sells the machine, now in 2014 she will be getting ₹ 2,00,000. So, the machine has to be recorded at ₹ 2,00,000 being the realisable value.

  • Liabilities are carried at settlement values, i.e. the undiscounted amount of cash or cash equivalent to be paid

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