Lower Cost or Net Realizable Value (LCNRV) is an accounting concept that helps businesses determine the value of their inventory. It’s a system of evaluating how much money is expected to be made from sales of an item, after all associated costs have been taken into account. LCNRV allows businesses to measure the true cost of their inventory and develop better strategies for managing purchases and pricing products accordingly. In short, it provides essential insight into what makes economic sense for business owners when faced with decisions about inventory.