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Sir how are you? Hope you are great!
I want to ask that what are meant by
(1) Net Realizable Value (NRV)
(2) Break up Value.
Kindly help me understand these terms or scenerios.NRV is sale value less selling costs. So, if a business had a machine that it could sell at auction for an estimaged $10,000 and the auctioneer charged 15% commission, the estimated NRV is $8,500 (10,000 – 15% x 10,000).
Break-up value is the cash a business would have if all its assets were sold and its liabilities paid off. It is the total of each asset’s NRV less liabilities.
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