Book Value Per Common Share Is Computed By
If company has issued common as well as preferred stock.
Book value per common share is computed by. The new formula for book value per share stockholders equity preferred stock arrears no. The book value per share bvps is calculated by taking the ratio of equity available to common stockholders against the number of shares outstanding. The term book value is a company s assets minus its liabilities and is sometimes referred to as stockholder s equity owner s equity shareholder s equity or simply equity.
Book value per common share or simply book value per share bvps is a method to calculate the per share book value of a company based on common shareholders equity in the company. Dividing stockholders equity applicable to common shares by the number of common shares outstanding. Multiplying the number of common shares outstanding times the market price per common share.
Book value of equity per share bvps is the ratio of equity available to common shareholders divided by the number of outstanding shares. Dividing total assets by the number of shares outstanding. The calculation of its book value per share is.
Book value per share 193 000 60 000 3000 10 000 13 per share of common stock. Calculate book value per share from the following stockholders equity section of a company. Book value per common share is computed by.
Notice the only the equity applicable to common shareholders is used. Book value per common share is calculated by dividing stockholders equity applicable to common shares by the number of common shares outstanding. Equity that is restricted or set aside for preferred shareholders or dividends can t be included in this total.
Book value per common share is calculated by dividing the stockholders equity applicable to common shareholders by the number of outstanding common shares. Shareholders equity preferred equity average number of common shares 20 million 5 million 5 million 15 million 5 million. When compared to the current market value per share the book value per share can provide information on how a company s stock is valued.