# What Is Book Value Of Equity?

## How is book value of a share calculated?

Book value per share (BVPS) takes the ratio of a firm’s common equity divided by its number of shares outstanding.

Book value of equity per share effectively indicates a firm’s net asset value (total assets – total liabilities) on a per-share basis..

## What is book value vs market value?

The book value of an asset is its original purchase cost, adjusted for any subsequent changes, such as for impairment or depreciation. Market value is the price that could be obtained by selling an asset on a competitive, open market.

## Does book value include debt?

No. To obtain book value, liabilities (which include debt) and intangible assets are subtracted from total assets.

## Why is book value different from market value?

Book value is a measurement frequently used by value investors. This metric differs from market value because it’s the shareholder’s equity, whereas market value is the real-time market price or the amount the investor would receive if they were to sell the stock at its current market price.

## What is price per share?

The price per share, or PPS, is the monetary amount paid or received for a given share of stock. The price per share can help investors decide whether a given company’s stock is worth buying.