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Lavender Ltd estimated that the net present value of future cash flows of a plant...

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Accounting

Lavender Ltd estimated that the net present value of future cash flows of a plant acquired in a business combination is $19,000. The cost of replacing the plant is estimated to be $21,000. The plant has been independently appraised at a value of $18,000. A similar plant cost the acquirer $22,000 last year. The fair value at which the plant will be recognised when recording the business combination is:

$18,000

$19,000

$21,000

$22,000

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