Explain How Net Realizable Value for Accounts Receivable Is Calculated

question 79

Essay

Explain how net realizable value for accounts receivable is calculated.On which financial statement is net realizable value shown?

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Definitions:

Restrictive Endorsement

A limitation placed on the use of a check or other negotiable financial instrument, specifying conditions under which it can be transferred or cashed.

Stop Payment Order

A request made to a bank to cancel a check or payment that has not been processed yet.

Subrogation

The legal process by which one party stands in for another to claim restitution or indemnity from a third party for a loss or damage.

Improper Payment

Payments made by organizations that should not have been made or that were made in an incorrect amount.