The Book Value Per Share Is Based On Quizlet

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.

The book value per share is based on quizlet. 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. 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. 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.

Total paid in capital 289 000. The book value per share bvps is calculated by taking the ratio of equity available to common stockholders against the number of shares outstanding. If the value of bvps exceeds the market value per share the.

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. Book value per share common equity total number of shares outstanding b. 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.

Common stock 4 00 par value 45 000 shares authorized. In other words this measures a company s total assets minus its total liabilities on a per share basis. Book value per share total assets total number of shares outstanding e.

Bus 320 test 1. Book value per share total shares issued per share par value c. 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.

Reinvested funds into retained earnings theoretically belong to. Preferred stock 6 par 6 5 000 shares authorized and issued 30 000. How is the book value per share calculated.