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SSC Audit Tax Finance P-II QUESTION #6190
Question 1
Financial managers prefer 'Market Value' over 'Book Value' because:
  • Book values are too difficult to calculate.
  • Market value reflects the actual cash value if an asset were sold today.✔️
  • Book values are always higher than market values.
  • Market values are mandated by historical cost accounting.
Correct Answer Explanation
Market value represents the true current worth, whereas book value is a historical cost [cite: 15].