Book Value Per Share Formula Accounting
Book value per share 2.
Book value per share formula accounting. 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. 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. Nbv is calculated using the asset s original cost how much it cost to acquire the asset with the depreciation depletion or amortization of the asset being subtracted from the asset s original cost.
Book value per share 25 000 000 5 000 000 10 000 000. Total assets total liabilities number of shares outstanding. Formula and calculation of p b ratio in this equation book value per share is calculated as follows.
Net book value nbv refers to a company s assets or how the assets are recorded by the accountant. Mathematically it is represented as book value of equity formula owner s contribution treasury shares retained earnings accumulated other incomes. The book value per share bvps is calculated by taking the ratio of equity available to common stockholders against the number of shares outstanding.
This shows anand group of a company have the book value per share of 2. Book value of equity formula it is calculated by adding the owner s capital contribution treasury shares retained earnings and accumulated other incomes. The formula for book value per share requires three variables.
Book value per share shareholders equity preferred equity total outstanding common shares. Book value per share book value per share bvps is a measure of value of a company s common share based on book value of the shareholders equity of the company. Book value per share conclusion the book value per share is the minimum cash value of a company and its equity for common shareholders.
The book value per share formula is used to calculate the per share value of a company based on its equity available to common shareholders. By using the book value per share formula. To find the equity you should subtract the company s liabilities from its assets.