Valuation Under Liquidation

Steps:

• Identify the context: A non-going concern means the business is shutting down and assets are sold off.
• Recall accounting principle: Assets are valued at realizable value, not ongoing use value.
• Apply to non-current assets: Fixed assets like property are assessed for quick sale proceeds.
• Select matching option: Choose the one reflecting sale value in liquidation.

Why C is correct:

• Under IFRS and GAAP, non-going concern valuation uses net realizable value, defined as the estimated selling price minus costs to sell, per IAS 1 and ASC 205.

Why the others are wrong:

• A: Net book value assumes ongoing operations and ignores current market conditions.
• B: Original cost is historical and irrelevant for liquidation proceeds.
• D: Owner's value is subjective and not an objective accounting basis.

Final answer: C