What is the purpose of ASC 820?

FASB ASC 820 defines fair value, provides a framework for measuring fair value in generally accepted accounting principles (GAAP), and requires extensive disclosures about fair value measurements.

What is ASC 820 fair value?

Accounting Standards Codification (ASC) Topic 820 defines fair value as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” This definition is similar in many respects to “fair market value,” which is defined …

When was ASC 820 created?

On March 4, 2014, the Board issued a proposed FASB Concepts Statement, Conceptual Framework for Financial Reporting—Chapter 8: Notes to Financial Statements, which the Board finalized on August 28, 2018.

Which statement describes the principal market under ASC 820?

ASC Topic 820 defines the principal market as the market with the greatest volume and level of activity.

What must be the highest and best use as defined in FASB ASC 820?

The highest and best use of the asset is in-exchange if the asset would provide maximum value to market participants principally on a standalone basis.

What is the fair value option ASC 825?

ASC 825-10-25, The Fair Value Option, encourages reporting entities to elect to use fair value to measure eligible assets and liabilities in their financial statements.

What is ASC Topic 825?

ASC 825 permits the fair value option election on an instrument by instrument basis at initial recognition.

What is the difference between a Type 1 and a Type 2 subsequent event?

Type I subsequent events provide evidence about conditions that existed on or before the balance sheet date. These events are recognized in the financial statements. Type II subsequent events provide evidence about conditions that did not exist on or before the balance sheet date.

What does ASC 805 stand for?

ASC 805 governs accounting rules for mergers and acquisitions (M&A), specifically how tangible and intangible assets are handled on the balance sheet. Under the rules, ASC 805 valuations require business acquisitions to be accounted for using the acquisition method.