The difference between the balance in Accounts Receivable and the balance in the Allowance for Doubtful Accounts is called the net realizable value.

Question

Quizplus · Accepted Answer

This statement is true. The net realizable value is calculated by subtracting the balance in the Allowance for Doubtful Accounts from the balance in Accounts Receivable. It represents the estimated amount of money the company expects to collect from its customers.

The Difference Between the Balance in Accounts Receivable and the Balance