Book Value To Equity Formula

Book value is the amount that investors would theoretically receive if all company liabilities were subtracted from all company assets.

Book value to equity formula. Book value per share us 134 05 billion 5 126 billion shares us 26 15. Book value per share will be bvps 495 61 book value calculator. Book value of equity formula.

Calculate book value of equity by subtracting a firm s total liabilities from its total assets to arrive at stockholders equity. This leaves a residual amount available for distribution to investors the concept is used to establish the minimum amount that a business should be worth which can be considered the lowest price at which the sum total of its stock should trade. This figure represents the minimum value of a company s.

Mathematically it is represented as book value of equity formula owner s contribution treasury shares retained earnings accumulated other incomes. Book value of equity also known as shareholder s equity is a firm s common equity that represents the amount available for distribution to shareholders. Equity assets liabilities.

The formula for book value per share book value of equity total number of outstanding shares taking above example of apple inc we can calculate the book value per share as follows. You can use this book value calculator. Net income on a per share basis is referred to as eps or earnings per share.

Book value of equity per share bvps is the ratio of equity available to common shareholders divided by the number of outstanding shares. For example in apple s 1q report released february 1 2018 the company reported total assets of 406 794 billion and liabilities of 266 595 billion. Using the accounting equation the book value of equity formula can be stated as follows.

Therefore the calculation of book value per share will be as follows bvps total common shareholders equity preferred stock number of outstanding common shares 2 93 491 00 cr 592 18 cr. Book value per share is also used in the return on equity formula or roe formula when calculating on a per share basis. The book value of equity is simply the difference between the total assets of a business and its total liabilities.