The Book Value Per Share Is Based On Quizlet

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.

The book value per share is based on quizlet. Book value per share total shares issued per share par value c. Learn more about how to calculate this ratio what it tells you and how investors use it to guide their decisions. Book value per share common equity total number of shares outstanding b.

The book value per share is based off of data while the market value per share is based off of data. Bus 320 test 1. From the following balance sheet information.

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. Finance practice questions exam 2. The numerator book value is also reduced by the cost to purchase the shares but the overall effect on the ratio is an increase in book value per share.

In other words this measures a company s total assets minus its total liabilities on a per share basis. Preferred stock 6 par 6 5 000 shares authorized and issued 30 000. Book value per share is based on the number of outstanding common shares which is reduced by the acquisition of treasury stock the denominator is reduced.

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. Be sure to use the average number of shares since the period end amount may incorporate a recent stock buyback or issuance which will skew the results. The book value per share bvps is calculated by taking the ratio of equity available to common stockholders against the number of shares outstanding.

Book value per share total assets total number of shares outstanding e. 10 000 shares issuesd 40 000. Total paid in capital 289 000.