Book Value

From Financial Literacy Wiki

Book value or carrying value is the value of an asset or liability according to its balance sheet account balance. Book value is the value carried on the bookkeeping records of an economic entity such as an individual, corporation, government, or other organization. Depending on the circumstances, assets and liabilities may be valued on a balance sheet at actual value (cash and cash equivalents), acquisition cost, depreciated value, amortized value, depleted value, or market value.

In fundamental analysis of stock share values, the book value of an entire company is its shareholders' equity. Shareholders' equity is the company's assets minus its liabilities. If a company's shareholders' equity is $100,000, the book value of the company is $100,000. If the company has 1,000 shares outstanding, each share has a book value of $100.