The term "net realizable value" means:
A) The amount the company would receive by selling the asset in orderly markets, less transaction costs
B) The sales value assuming the company must sell immediately
C) The price at which someone can buy the asset now.
D) The price at which an asset can be sold in orderly markets

Question

Quizplus · Accepted Answer

Net realizable value refers to the estimated selling price of an asset in the ordinary course of business, less the costs of completion, disposal, and transportation. It is the amount that a company expects to receive from the sale of an asset after deducting any costs associated with preparing the asset for sale, including marketing, shipping, and other expenses. Therefore, option A is the correct choice.

The Term "Net Realizable Value" Means