Assets are recorded at their cost when acquired by the company and this value stays same over the time according to the historical cost principle. On the other hand, the fair value principle dictates that assets and liabilities should be reported at their fair values. Simply, fair value refers the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Therefore, contrary to historical cost principle, the recorded monetary amount of the asset should be revalued at reporting date according to the fair value principle. E is the right answer.