What is net realizable value, Accounting Basics

Assignment Help:

Q. What is Net realizable value?

Companies must not carry goods in inventory at more than their net realizable value. Net realizable value is the approximate selling price of an item less the estimated costs that the company incurs in preparing the item for sale and selling it. Obsolete, Damaged or shopworn goods often have a net realizable value lower than their historical cost and must be written down to their net realizable value. But goods don't have to be obsolete, damaged or shopworn for this situation to occur.

Technological changes as well as increased competition have caused significant reductions in selling prices for such products as DVD players, computers, TVs and digital cameras.


Related Discussions:- What is net realizable value

Samuel, what is the implication of applying accounting concept wrongly

what is the implication of applying accounting concept wrongly

#princess, what are the implications of applying accounting concepts wrongl...

what are the implications of applying accounting concepts wrongly

Show earnings per share, Q. Show Earnings per share? Earnings per-share...

Q. Show Earnings per share? Earnings per-share amounts are based upon the weighted average number of common as well as common equivalent shares outstanding during the year. Com

Neutrality of accounting information, Q. Neutrality of accounting informati...

Q. Neutrality of accounting information? The Neutrality signifies that the accounting information must be free of measurement method bias. The primary concern must be relevance

Final accounts, stpes to be taken prepaing for final accounts

stpes to be taken prepaing for final accounts

Procedure of recording business transactions, Q. Procedure of recording bus...

Q. Procedure of recording business transactions? The raw information of accounting is the business transactions. We documented the transactions in section 1 as increases or dec

Balance sheet, what accounts go into a balance sheet

what accounts go into a balance sheet

Perpetual and periodic inventory method, Perpetual and Periodic inventory ...

Perpetual and Periodic inventory                                                                             a)  Describe the difference between the perpetual inventory method

Accounting standards in brief, Accounting Standards  The flexibili...

Accounting Standards  The flexibilities offered by a choice of accounting treatments distinctly diminish, and even distort the comparability of relevant inform

What do you understand by revenue, Q. What do you understand by Revenue? ...

Q. What do you understand by Revenue? Revenue -- Amounts received by or due a company for services or goods it provides tocustomers. Receipts are cash revenues. Revenues can al

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd