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Which of the following valuation methods reflects current values? A. acquisition cost B. present value of...

Which of the following valuation methods reflects current values?

  • A. acquisition cost

  • B. present value of cash flows using historical interest rates

  • C. net realizable value

  • D. adjusted acquisition cost

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Answer #1

Which of the following valuation methods reflects current values?

C. Net realizable value.

Net realizable value is the value for which an asset can be sold, less the estimated costs of selling the asset. The NRV is commonly used in the estimation of the value of ending inventory or accounts receivable. If the fair market value of the asset is unknown, the net realization value is used to reflect the current values of assets.

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