The difference between the total receivables and the balance in Allowance for Doubtful Accounts at the end of a period is referred to as the net realizable value of the receivables.

Question

Quizplus · Accepted Answer

This statement is true. The net realizable value of receivables is the amount of receivables that a company expects to collect from its customers after considering the amount that is not going to be collected i.e. doubtful accounts. It is calculated by subtracting the balance in the allowance for doubtful accounts from the total receivables.

The Difference Between the Total Receivables and the Balance in Allowance