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what is net book value formula. The formula used to calculate the net book value of the assets is as below. The formula for calculating NBV is as follows.
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This means the net book value of the truck would be 65000 after five years. For example if the shareholders equity section of the balance sheet contained a total of 1000000 and there were 200000 shares outstanding then the book value per share would be 5. Let us take the example of Company ABC which purchased a Mega Widget for 100000 three years back.
It can be defined as the net asset value of the firm or of the company that can be calculated as total assets less intangible assets that is goodwill patents etc and liabilities.
This Mega Widget depreciates every year by 10000. Formula to Calculate Book Value of a Company. The net book value of an asset is the cost of the asset minus accumulated depreciation. NBV 100000 - 7000 x 5 years 65000.
