Lower of Cost or Net Realizable Value Rule for Inventory
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Lower of Cost or Net Realizable Value Rule for Inventory
Inventory is presented on the Balance Sheet at the lower of cost or net realizable value, where the net realizable value is the expected selling price minus any costs to complete the sale. If a company's net realizable value decreases such that it is lower than the inventory's cost, the company should take an inventory writedown for the amount ...
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Net Realizable Value Formula
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