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April 20, 2026, 05:10:33 pm
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Author Topic: net realisable value  (Read 3140 times)  Share 

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p.taaa

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net realisable value
« on: December 19, 2012, 10:54:21 pm »
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explain why stock would normally be alued at its cost, rather than its NRV?
can someone help me please?
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BoredSatan

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Re: net realisable value
« Reply #1 on: December 19, 2012, 11:00:58 pm »
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Because in accounting we follow the 'lower of cost or NRV' rule.

Since the NRV is usually higher than its cost (NRV= estimated selling price less selling expenses), therefore if we were to value stock at NRV, we would be breaching conservatism by overstating assets.

However, when NRV drops below cost (when stock write down occurs), then we would value stock at NRV.
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TimmyC

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Re: net realisable value
« Reply #2 on: December 19, 2012, 11:08:19 pm »
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Quote from: BoredSatan on December 19, 2012, 11:00:58 pm
Because in accounting we follow the 'lower of cost or NRV' rule.

Since the NRV is usually higher than its cost (NRV= estimated selling price less selling expenses), therefore if we were to value stock at NRV, we would be breaching conservatism by overstating assets.

However, when NRV drops below cost (when stock write down occurs), then we would value stock at NRV.
the fak your name change haha

while I have the opportunity.. what do you think would be the best for me to do in my 3&4 accounting textbook to do as well as possible?  :P

o and I am buying the study guide
« Last Edit: December 19, 2012, 11:10:06 pm by Timmyyy »
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BoredSatan

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Re: net realisable value
« Reply #3 on: December 19, 2012, 11:17:02 pm »
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Quote from: Timmyyy on December 19, 2012, 11:08:19 pm
the fak your name change haha

while I have the opportunity.. what do you think would be the best for me to do in my 3&4 accounting textbook to do as well as possible?  :P

o and I am buying the study guide
Doing all the questions in your text book is a MUST. Do half before your school gets to the topic, then complete the other half while you go through it in class.

It is really important to get ahead as this gives you the maximum time to prepare for the end of year exam.

And yeah.. SOMEONE changed my username :(
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TimmyC

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Re: net realisable value
« Reply #4 on: December 19, 2012, 11:22:36 pm »
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Ah yes, do you suggest touching on all topics before the commencement of school? Or just the earlier sort of ones
so glad I got my textbooks so much earlier :D

sorry for jacking the thread haha..
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abcdqdxD

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Re: net realisable value
« Reply #5 on: December 20, 2012, 12:15:27 am »
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Quote from: BoredSatan on December 19, 2012, 11:17:02 pm
It is really important to get ahead as this gives you the maximum time to prepare for the end of year exam.

Agree 100% :)

But I think this will be less of an issue with the removal of mid years (which in all honesty required some major cramming)
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abcdqdxD

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Re: net realisable value
« Reply #6 on: December 20, 2012, 12:18:40 am »
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Quote from: Timmyyy on December 19, 2012, 11:22:36 pm
Ah yes, do you suggest touching on all topics before the commencement of school? Or just the earlier sort of ones
so glad I got my textbooks so much earlier :D

sorry for jacking the thread haha..

I don't think its essential to touch on ALL topics, but it may be worth doing some Unit 3 work over the holidays. Also, don't do too much and burn yourself out before school even starts. VCE is a marathon not a sprint ;)

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BoredSatan

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Re: net realisable value
« Reply #7 on: December 20, 2012, 02:06:20 am »
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Quote from: Timmyyy on December 19, 2012, 11:22:36 pm
Ah yes, do you suggest touching on all topics before the commencement of school? Or just the earlier sort of ones
so glad I got my textbooks so much earlier :D

sorry for jacking the thread haha..
half of unit 3 would be worthwhile
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TimmyC

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Re: net realisable value
« Reply #8 on: December 20, 2012, 09:27:52 am »
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Quote from: BoredSatan on December 20, 2012, 02:06:20 am
half of unit 3 would be worthwhile
Quote from: liverpoolxD on December 20, 2012, 12:18:40 am
I don't think its essential to touch on ALL topics, but it may be worth doing some Unit 3 work over the holidays. Also, don't do too much and burn yourself out before school even starts. VCE is a marathon not a sprint ;)



Thanks lads!!
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BoredSatan

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Re: net realisable value
« Reply #9 on: December 20, 2012, 12:39:26 pm »
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Liverpool stole the VCE is a marathon not a sprint off me ;)
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abcdqdxD

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Re: net realisable value
« Reply #10 on: December 20, 2012, 12:40:10 pm »
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really? :P
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TimmyC

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Re: net realisable value
« Reply #11 on: December 20, 2012, 12:51:05 pm »
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Hope I can do as well in accounting as you guys hahah  :P
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BoredSatan

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Re: net realisable value
« Reply #12 on: December 20, 2012, 01:39:16 pm »
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Its all about practice.

PM me if you need any help :)
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abcdqdxD

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Re: net realisable value
« Reply #13 on: December 20, 2012, 01:52:14 pm »
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Or ask on forums so everyone can benefit :P
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