Definition, Meaning & Synonyms

net-realizable-value

noun

/nɛt ˌriːəˈlaɪzəbl væljuː/

Definition

The estimated selling price of an asset in the ordinary course of business, minus the estimated costs of completion and the estimated costs necessary to make the sale.

Examples

The net-realizable value of the inventory was calculated to ensure accurate financial reporting.
After assessing the associated costs, the company found that the net-realizable value of the property was significantly lower than anticipated.
Net-realizable value plays a crucial role in determining the impairment of long-term assets.

Meaning

Net-realizable value is a measure used to evaluate the worth of an asset, taking into account the potential profits after considering expenses associated with its sale.