What is the fair value less costs of disposal of the machine

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Pracchia Co owns a machine. An expert valuer has estimated that the price that could be obtained from selling the machine in an orderly sale is $750 000. Pracchia Co would be required to cover the estimated costs of $20 000 to remove the machine from its factory and transport it to any potential buyer. Use of the machine is essential in manufacturing one of the company's product lines, so that in practice disposal of the machine would lead to a minor reorganisation of the business. The costs of carrying out this reorganisation are estimated at $40 000. The fee charged by the expert valuer for performing the valuation was $5000.

Problem 1:
In accordance with the requirements of IAS 36 Impairment of Assets, what is the fair value less costs of disposal of the machine?

Reference no: EM133008486

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