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Balance Sheet Identity

   Also found in: Wikipedia 0.01 sec.
Balance sheet identity
Total assets = Total liabilities + Total stockholders' equity.

Net Assets
In accounting, the value of a company's total assets less its total liabilities and intangible assets. Put another way, the book value is the shareholders' equity, or how much the company would be worth if it paid of all of its debts and liquidated immediately.


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This formula is derived from the balance sheet identity and the definition of the weighted average cost of capital (for a similar presentation, see Berk and De Marzo, 2007).
 
 
 
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