Definition of Book Value

Book Value is a corporation’s book value is the theoretical liquidation value of the company. Book value is in theory what some one would be willing to pay for the entire company.

Applying "Book Value" to Securities Exams:

If a corporation were to sell off all its assets and subtract from that amount the total of its liabilities, what is left would be the company’s book value. This is not to be confused with market value, which is the selling price of company’s shares.

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