CERTYNEX IFRS ACADEMY

Brenan has offered a plant for sale for several months at a price far above any reasonable estimate of its fair value, and no offer has come in. Case assumption: the other elements of the plan are in place. Which conclusion is consistent with the price criterion?

The criterion is met, because the plant has actually been offered for sale for several months to potential buyers.

The criterion of a reasonable price in relation to fair value is not met: the sale cannot be judged highly probable.

The criterion is met as soon as management has itself chosen the price, which reflects its view of value.

The asking price has no bearing once management has launched a programme to locate a buyer.