Accounting · Fair Value Measurement
A company estimates the fair value of a specialized piece of industrial machinery using two inputs: (1) Quoted price of similar machinery in an active market, which requires significant adjustments for specialization (Level 2/3 input). (2) A discounted cash flow model based on the company's own proprietary, non-market-observable forecasts (Level 3 input). If the Level 3 unobservable input is significant to the overall fair value measurement, to which level of the Fair Value Hierarchy under IFRS 13 must the final valuation be assigned?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
Share:
- 1Level 4
- 2Level 3✓
- 3Level 2
- 4Level 1
Correct answer
Level 3
Download Single Question PDF
Save this question and verified answer as a clean study sheet with live clickable link.
👥
Share with Friends & Study Groups
Challenge your peer aspirants on WhatsApp or Telegram to solve this question!
Online Test Series
Start Free Mock Test →Preparing for Accounting?
Practice full-length mock tests with real exam timers, instant score analysis, and all-India ranking.
Chapter Practice
Practice Fair Value Measurement MCQs →Want more practice questions on Fair Value Measurement?
Solve complete topic-wise tests with detailed solutions on GkGet.
Related Practice Questions
Recommended practice questions in Accounting · Fair Value Measurement