The net realizable value of receivables is calculated as the face value of the receivables less adjustments for
A)sales returns and sales discounts.
B)actual uncollected amounts adjusted for purchase discounts.
C)bad debts already written off.
D)sales returns, cash discounts, and estimated uncollectible accounts.

Question

Quizplus · Accepted Answer

Net realizable value of receivables refers to the amount of cash a company expects to collect from its accounts receivable after subtracting any adjustments for sales returns, cash discounts, and estimated uncollectible accounts. Option D includes all the necessary adjustments required for net realizable value calculation. Hence, D is the best choice.

The Net Realizable Value of Receivables Is Calculated as the Face