Accounting for IGCSE & O level - Final Statements (Section 2 - No. 19)
In the context of inventory valuation, what is the significance of "net realizable value"?
It is the price the company paid for the inventory.
It is the estimated selling price less any costs of completion and disposal.
It is the cost of the newest inventory items.
It is a measure of the inventory's historical cost.
Explanation
Net Realizable Value is the expected selling price of an item less any costs to sell or dispose of it.
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