Book Value Per Share Formula Accounting

Book value per share 2.

Book value per share formula accounting. Market value per share is. 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. 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.

Book value per share shareholders equity preferred equity total outstanding common shares. The formula for book value per share requires three variables. 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.

By using the book value per share formula. 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. This shows anand group of a company have the book value per share of 2.

Total equity preferred equity and total outstanding shares. Book value per share conclusion the book value per share is the minimum cash value of a company and its equity for common shareholders. It is the amount that shareholders would receive if the company dissolves realizes cash equal to the book value of its assets and pays liabilities at their book value.

Net book value nbv refers to a company s assets or how the assets are recorded by the accountant. 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 book value per share formula is used to calculate the per share value of a company based on its equity available to common shareholders.

To find the equity you should subtract the company s liabilities from its assets. 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. Formula and calculation of p b ratio in this equation book value per share is calculated as follows.