Book value refers to the value of an asset or a company as recorded on the balance sheet, representing the net asset value calculated by subtracting total liabilities from total assets. It provides an essential measure of a company's worth based on historical costs and accounting principles. Understanding book value is crucial as it helps assess financial health, serves as a benchmark for valuation standards, and influences financial reporting and analysis.
congrats on reading the definition of book value. now let's actually learn it.