Investing term
What is Book value?
Total assets minus total liabilities — the accounting net worth of the business.
Book value is a company's accounting net worth — total assets minus total liabilities — as recorded on the balance sheet. It's what would theoretically remain for shareholders if the company sold everything at its stated value and paid off all debts. It anchors the price-to-book ratio, though for asset-light businesses it can badly understate real worth.
For example
A company with $10M of assets and $6M of debt has a $4M book value — but if its real value is a brand or software, book value misses most of it.
Book value is taught hands-on in Stage 15 — Valuation for Investors.
See the lesson →