BOOK VALUE

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Definitions

book value of a stock is determined from a company's records, by adding all assets (generally excluding such intangibles as good will), then deducting all debts and other liabilities, plus the liquidation price of any preferred issues. The sum arrived at is divided by the number of common shares outstanding and the result is book value per common share. Book value of the assets of a company or a security may have little or no significant relationship to market value.