Average Book Value Of Investment Formula

Therefore the calculation of book value per share will be as follows bvps total common shareholders equity preferred stock number of outstanding common shares 2 93 491 00 cr 592 18 cr.

Average book value of investment formula. Book value per share will be bvps 495 61 book value calculator. Note that the book value of the asset can never dip below the salvage value even if the calculated expense that year is large enough to put it below this value. To arrive at the book value simply subtract the depreciation to date from the cost.

In case where subsequent investments are to be made after the initial investment the above formula would not account for the additional investment. Average annual profit total profit over investment period number of years. The formula for arr is.

In the example above the asset s book value after 6 years would be 10 000 6000 or 4000. Arr average annual profit average investment. Instead the average book value shall be found by adding the net book value n b v of investment assets at the end of each year as follows.

Average investment book value at year 1 book value at end of useful life 2.