ABC Ltd purchased an item inventory at a cost of $27 000. The item was damaged during storage. The company could sell the item in its damaged state for $23 000, and in doing so incur selling costs of $1000. The net realisable value of the item of inventory is $23 000.

Question

Quizplus · Accepted Answer

The net realisable value of the item of inventory is $22,000, calculated by subtracting the selling costs ($1,000) from the potential selling price ($23,000).

ABC Ltd Purchased an Item Inventory at a Cost of $27