The Net Realizable Value of Accounts Receivable Is The

question 111

Multiple Choice

The net realizable value of accounts receivable is the:

• A) amount the company can collect from a factor when the receivables are sold.
• B) amount remaining after uncollectible accounts are written off.
• C) amount the company expects to collect from customers.
• D) amount the company expects to pay to creditors.

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Definitions:

LIFO

Stands for Last In, First Out, an inventory valuation method which assumes that the last items placed in inventory are sold first.

Financial Statement

Documented records that outline the financial activities and condition of a business, individual, or other entity.

LIFO Reserve

The difference between the cost of inventory calculated under the LIFO method and its cost calculated under the FIFO method.

FIFO Firms

Companies that apply the First-In, First-Out method in their inventory management, recognizing the oldest inventory items as the first sold.