PRC-1 · Chapter 7 · Question 97 of 100
When calculating Net Realizable Value (NRV), an item has an estimated selling price of Rs. 1,000. It requires Rs. 150 of repairs before it can be sold. A 5% sales commission must be paid on the final selling price. What is the NRV?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Rs. 800
Explanation
NRV = Estimated Selling Price (1,000) - Estimated costs of completion/repair (150) - Estimated costs to sell [5% of 1,000 = 50] = 1000 - 150 - 50 = Rs. 800.
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