Situations in which net realizable value is used to value inventory include

Question

Quizplus · Accepted Answer

Net realizable value is used to value inventory in all of these situations. It is the estimated selling price of goods less estimated costs of completion, disposal, and transportation. Agricultural inventory, minerals and mineral products, and commodities held by broker-traders are all subject to fluctuations in market prices, making net realizable value an appropriate valuation method.

Situations in Which Net Realizable Value Is Used to Value