Book Value Of An Asset Formula
The book value of an asset is its original purchase cost minus any accumulated depreciation.
Book value of an asset formula. Sample calculation of net book value. Therefore the book value is 8 5 calculating the present amount or worth when the book value the salvage value the total estimated life of the asset and the number of years of the asset is given. Or book value shareholder s equity broadly equity share capital reserves and surpluses.
Depreciation periodic reduction in the value of the asset amortized as per standards. Net book value original asset cost accumulated depreciation. Assets book value formula total value of an asset depreciation other expenses directly related to it.
The formula for calculating book value per share is the total common stockholders equity less the preferred stock divided by the number of common shares of the company. How book value of assets works. Alternatively book value can be calculated as the sum total of the overall shareholder equity of the company.
Book value may also be. Book value of assets formula. P b x n t s.
Accumulated depreciation per year depreciation x total number of years. Formula to calculate book value of a company. When it reaches the end of its useful life the nbv should be equal to its salvage value.
Net book value of assets 100 000 72 000 usd 28 000 in year fifth the accumulated depreciation will increase to 90 000 usd and the net book value will equal to 10 000 or equivalent to scrap value of assets. Book value formula calculates the net asset of the company derived by total of assets minus the total liabilities. Other cost include impairment cost and related costs.