Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 20 - No. 6)
What does 'net realizable value' represent in the context of accounts receivable?
The total amount of accounts receivable.
The estimated amount of accounts receivable that will be collected.
The original cost of the goods sold on credit.
The amount of bad debt expense.
Explanation
Net realizable value is the amount the business expects to receive from its receivables.
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