Peoples Inc Has A Book Value Of Equity

Fixed assets are 18 380 and current liabilities are 1 630.

Peoples inc has a book value of equity. The shares outstanding are 5 000. Since the company s market value is greater than its book value the market expects a return of 18. Now on to your concern.

Book value per share bvps takes the ratio of a firm s common equity divided by its number of shares outstanding. So negative equity alone has no meaning. It is calculated by multiplying a company s share price by its number of shares outstanding whereas book value or shareholders equity is simply the difference between a company s assets and liabilities.

It can be useful to compare the market price of shares to the book value. Market value of equity vs book value of equity. The book value of equity in turn is the value of a company s assets.

Book value of equity per share effectively indicates a firm s net asset value. Assets liabilities equity 1 080 debt equity 490 590 the debt weight for the wacc calculation is. The equity value of a company is not the same as its book value.

The firm s average interest rate on the debt on its books is 10 this is the interest expense divided by the face value of the debt which is entirely in the form of 10 year corporate bonds. Billion book value of capital invested of 2 5 billion and a cost of capital of 9. To make this easier convert total book value to book value per share.

Suppose a company has a book value of 35 million and there are 1 4 million common shares outstanding. Sunset inc has a book value of equity of 13 205. Estimate the value of bigname inc s brand name.