Increase Productivty

Measurement

In order for an economic event to be recognized, it has to be measured. There are five ways to measure an economic event, though not all events have all five attributes:

1. Historical cost.The cash equivalent price paid for goods or services on the acquisition date
2. Current replacement cost.The price that would be paid currently to purchase or replace equivalent goods or services (e.g., a computer that has declined in value). There are two ways to measure replacement cost: The replacement of the computer with an identical
   old computer or the replacement of the computing power the computer contained
3. Current market value.The price that would be received from selling an asset (e.g., the market value of an investment in stock may change daily)