Net realizable value method

Net realizable value method (NRV method) is method that allocates joint costs to joint products on the basis of final sales value minus separable costs of total production of the joint products during the accounting period.

Definitions

According to Cost Accounting by Horngren, Datar, Rajan (14th edition),

Net realizable value method (NRV method). Method that allocates joint costs to joint products on the basis of final sales value minus separable costs of total production of the joint products during the accounting period.