book value

Book Value

1. The value at which an asset is carried on a balance sheet. In other words, the cost of an asset minus accumulated depreciation.

2. The net asset value of a company, calculated by total assets minus intangible assets (patents, goodwill) and liabilities.

Notes:

Book value is the accounting value of a firm. It has two main uses:

1) It is the total value of the company's assets that shareholders would theoretically receive if a company were liquidated.

2) By being compared to the company's market value, the book value can indicate whether a stock is under or over-priced.

In the U.K., Book Value is known as "Net Asset Value."

See also: Balance Sheet, Carrying Value, Depreciation, Market Value, Stock Holder's Equity

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Book value

A company's total assets minus intangible assets and liabilities, such as debt. A company's book value might be higher or lower than its market value.

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book value

1. The net dollar value at which an asset is carried on a firm's balance sheet. For example, a building that was purchased for $900,000 but that has depreciated $200,000 has a book value of $700,000. Book value, an accounting concept, often bears little relation to an asset's market value. Also called carrying value, depreciated cost.

2. See book value per share.