It is calculated by multiplying a company's share price by its number of shares outstanding, whereas book value or shareholders' equity is simply the difference between a company's assets and liabilities. Read our editorial standards. Add up all the assets, subtract all the liabilities and the result is the book value. Book value per common share (BVPS) derives a company's book value on a per-share basis. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem. Your IP: If XYZ can generate higher profits and use those profits to buy more assets or reduce liabilities, the firm's common equity increases. It's mainly used for tax purposes. This gives an exact book value price per share of common stock. Its a measure of what shareholders would theoretically get if they sold all of the assets of the company and paid off all of its liabilities. Ali Hussain worked in credit risk management, analyzing the risk factors of doing business with hedge funds. The book value of a company is the total worth of all its assets minus all its liabilities. Book value per share (BVPS) is the ratio of equity available to common shareholders divided by the number of outstanding shares. The market value of a company is based on the current stock market price and how many shares are outstanding. When you visit the site, Dotdash Meredith and its partners may store or retrieve information on your browser, mostly in the form of cookies. Get the latest tips you need to manage your money delivered to you biweekly. If book value is negative, where a company's liabilities exceed its assets, this is known as a balance sheet insolvency. and similar publications. Increase your company's total equity by repurchasing shares or by issuing new stock shares. The price-to-book (P/B) metric allows investors to compare a company's market capitalization to its book value, in the form of a ratio. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. As suggested by the name, the book value per share calculation begins with finding the necessary balance sheet data from the latest financial report (e.g. The market value is forward-looking and considers a companys earning ability in future periods. Increase the total equity of the company through share repurchases, which reduce the number of shares outstanding, or by issuing new shares of stock. You can email the site owner to let them know you were blocked. The Book Value Per Share calculation formula is as follows: Book Value Per Share = Total owners' equity / Number of shares outstanding. Net income on a per share basis is referred to as EPS, or earnings per However, as the assets would be sold at market prices, and book value uses the historical costs of assets, market value is considered a better floor price than book value for a company. Now, lets say that XYZ Company has total equity of $500,000 and 2,000,000 shares outstanding. The term "book value" is a company's assets minus its liabilities and is sometimes referred to as Once you have the numbers entered into the formula, you can divide to find the result. Even if a company has a high book value per share, theres no guarantee that it will be a successful investment. On the other hand, book value per share is an accounting-based tool that is calculated using historical costs. What Is the Book Value per Share of a Company? This website is using a security service to protect itself from online attacks. Another way to increase BVPS is to repurchase common stock from shareholders and many companies use earnings to buy back shares. Understanding Book Value Per Share (BVPS), Market Value Per Share vs. Book Value Per Share, Book Value Per Common Share (BVPS): Definition and Calculation, Book Value: Definition, Meaning, Formula, and Examples, Price-to-Book (PB) Ratio: Meaning, Formula, and Example, Graham Number: Definition, Formula, Example, and Limitations, Value Stock: What It Is, Examples, Pros and Cons. Using the period-end amount (which includes short-term events) may provide incorrect results and may mislead investors into thinking that the stock price is overvalued or undervalued when it is not actually the case. Earnings per share would be the net income that common shareholders would receive, per share (companys net profits divided by outstanding common shares), The book value per share of a company is the total value of the companys. What Does Book Value Per Share (BVPS) Tell You? The Graham number is the upper bound of the price range that a defensive investor should pay for a stock. Assets on a company's balance sheet can include: Liabilities on a company's balance sheet can include: When defined as the difference between a company's total assets and its total liabilities, the formula for calculating book value is: Book value = Total Assets - Total Liabilities. Stock market investors will often assign incremental value to considerations like: For instance, consider a given company that has a market value approximately equal to its book value. The formulas and examples for calculating book value per share with and without preferred stock are given below: (1). A company's book value can lull investors into a false sense of security, that if the company declared bankruptcy, they could still recoup their investment. Given that Company B has a higher book value per share, you might find it tempting to invest in that company. Reviewing the steps and the formula needed to calculate the book value per share.Guided notes: https://docs.google.com/document/d/1uUUpOfK-J0MT7pC3iOPC5bvLV5. If the book value per share is lower than its market value per share, it can indicate an overpriced, or overvalued stock. Using the same share basis formula, we can calculate the book value per share of Company B. Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. The share aspect of this ratio refers to the common shares of the company. Book Value per Share (BVPS) is the ratio of a company's equity available to common shareholders to the number of outstanding company shares. The exact formula is as follows: Book value per share can vary widely from one company to the next. Terms apply to offers listed on this page. Market Capitalization reflects the economic value that investors assign to ownership of a public company's shares. A company can also increase the book value per share by using the generated profits to buy more assets or reduce liabilities. He started his career with Deutsche Bank and worked at other large financial institutions, such as Citigroup, Bear Stearns, and Societe Generale. Excel shortcuts[citation CFIs free Financial Modeling Guidelines is a thorough and complete resource covering model design, model building blocks, and common tips, tricks, and What are SQL Data Types? She stays on top of worldwide news about science, government policies, finance, infrastructure, and medical issues. Unlike the market value per share, the metric is not forward-looking, and it does not reflect the actual market value of a companys shares. Here's the formula for how to calculate Book Value per Share: This formula takes the total book value, subtracts the preferred shareholder equity, and then divides by the total outstanding shares of common stock. If the asset is a capital expense (something that will be used for many years), its value is typically depreciated (reduced) each accounting . The next assumption states that the weighted average of common shares outstanding is 1.4bn. Feel Free to Enjoy! Investors tend to assign value to companies' growth and earnings potential, not just their balance sheet assets. value per share is similar to net worth, meaning it is assets minus debt, and may be looked at as though what would occur or her own discretion, as no warranty is provided. There are a few different ways that companies can increase their book value per share: There are some limitations to the book value per share metric that you should be aware of: In the example from a moment ago, a company has $1,000,000 in equity and 1,000,000 shares outstanding. The price-to-book (P/B) ratio evaluates a firm's market value relative to its book value. We're sending the requested files to your email now. TotalEquity When compared to the current market value per share, the book value per share can provide information on how a companys stock is valued. Book value also can never be guaranteed to mean fair value, or minimum value. Solution: First, we need to find out shareholder's equity which is the difference between Total Assets and Liabilities, which is 53,500,850.89 - 35,689,770.62 = 17,811,080.27 Therefore, the calculation of book value per share is as follows, BVPS = Total Common shareholders equity - Preferred Stock / Number of outstanding common shares Entering text into the input field will update the search result below. The term "book value" is a company's assets minus its liabilities and is sometimes referred to as stockholder's equity, owner's equity, shareholder's equity, or simply equity. It depends on a number of factors, such as the companys financial statements, competitive landscape, and management team. This means that it can sometimes be misleading. You can email the site owner to let them know you were blocked. Like other multiple-based. The book value per preferred share is calculated by dividing the call price or par value plus the cumulative dividends in arrears by the number of outstanding preferred shares. Your IP: It is important to distinguish between book value and similar concepts like market value and carrying value. In the accounting world, book value refers to the worth of a particular asset on a company's balance sheet say, a piece of property or equipment. Even if a company has a high book value per share, theres no guarantee that it will be a successful investment. But what exactly is book value per share? Enroll in The Premium Package: Learn Financial Statement Modeling, DCF, M&A, LBO and Comps. To see our product designed specifically for your country, please visit the United States site. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. It also accounts for all of the company's liabilities, such as debt or tax burdens. The difference between book value per share and the market share price is as follows. Alternatively, another method to increase the BVPS is via share repurchases (i.e. Analysts Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. There are several actions that could trigger this block including submitting a certain word or phrase, a SQL command or malformed data. Shareholders equity is the owners residual claim in the company after debts have been paid. Companies accumulate ownership of various types of assets over time, all recorded in their financial statements. Two ways to increase book value per share: Comparing BVPS to the market price of a stock is known as the market-to-book ratio, or the price-to-book ratio. In other words, divide the applicable equity by the number of shares. She holds a Bachelor of Science in Finance degree from Bridgewater State University and helps develop content strategies for financial brands. Based on the above formula, calculation of Book value of Equity of RSZ Ltd can be done as, = $5,000,000 + $200,000 + $3,000,000 + $700,000. Now, lets say that Company B has $8 million in stockholders equity and 1,000,000 outstanding shares. When calculating the book value per share of a company, we base the calculation on the common stockholders equity, and the preferred stock should be excluded from the value of equity. It is because preferred stockholders are ranked higher than common stockholders during liquidation. S When investigating which stocks to buy, investors often have to look hard into companies' financials. The company then hires a famous turnaround manager which excites investors, who bid the shares higher. It's important to use book value and book value per share in the right context, and with the right stocks. These are assets that dont have a physical form , such as patents or. When a firm buys an asset, the purchase price is the book value. Structured Query Language (known as SQL) is a programming language used to interact with a database. Excel Fundamentals - Formulas for Finance, Certified Banking & Credit Analyst (CBCA), Business Intelligence & Data Analyst (BIDA), Commercial Real Estate Finance Specialization, Environmental, Social & Governance Specialization, Cryptocurrency & Digital Assets Specialization (CDA), Business Intelligence Analyst Specialization, Financial Planning & Wealth Management Professional (FPWM). For companies in industries that are being disrupted (for example, a newpaper publisher), the carrying value of assets on the balance sheet may significantly overestimate the real economic worth of those assets. To calculate the book value per share, you must first calculate the book value, then divide by the number of common shares. It's basically the break-up value the amount that the company would be worth if it were liquidated. ROE is net income divided by stockholder's equity. A company can use the following two methods to increase its book value per share: One of the main ways of increasing the book value per share is to buy back common stocks from shareholders. It is equal to a firm's total assets minus its total liabilities, which is the net asset value or book value of the company as a whole. $8 million in Stockholders Equity $0 million of Preferred Stock 1,000,000 Shares Outstanding = $8.00 Book Value Per Share. In the investing/financial world, book value's meaning is an expanded, extrapolated version of the first definition. If a stock is trading below its book value per share, it means that the market is valuing the company at less than its liquidation value. A company that has a book value of $200 million, and 25 million outstanding shares would have a Book Value Per Share of $8.00. Book Value Per Share (BVPS) = ( Total Equity - Preferred Stock) / Shares Outstanding. Click to reveal In some cases, we receive a commission from our partners; however, our opinions are our own. There are a number of other factors that you need to take into account when considering an investment. In the absense of The action you just performed triggered the security solution. This investment strategy boils down to bargain-hunting: Rather than targeting the best-performing equities, it seeks out low-priced, neglected stocks in the hope that their share prices will eventually rise again. Contact@FinanceFormulas.net. Earnings per share would be the net income that common shareholders would receive per share (companys net profits divided by outstanding common shares). Get instant access to video lessons taught by experienced investment bankers. Sandra Habiger is a Certified Public Accountant with a Bachelors Degree in Business Administration from the University of Washington. The Book Value of a company is equal to their shareholders (or stockholders') equity, and reflects the difference between the balance sheet assets and the balance sheet liabilities. In order to calculate the book value of a company, you may need access to current financial information. Learn financial statement modeling, DCF, M&A, LBO, Comps and Excel shortcuts. The company has an average of 3 million shares outstanding during the period. This will give you the amount of net assets that each preferred share owns or has the rights to. Performance & security by Cloudflare. Conventionally, a company with a P/B ratio below 1.0x is considered an attractive value investment, from the perspective that the book value of its assets is higher than the value the market is currently assigning. Many value investors build their portfolio based on low P/B stocks. Since public companies are owned by shareholders, this is also known as the total shareholders' equity. The book value per share formula is used to calculate the per share value of a company based on its equity available to The book value per share formula is very simple. If a manufacturer buys assembly equipment for $20 million, it records that equipment at a book vaue of $20 million. To get the book value, you must subtract all those liabilities from the company's total assets. For example, intangible factors affect the value of a companys shares and are left out when calculating the BVPS. For example, if a company has total common equity of $1,000,000 and 1,000,000 shares outstanding, then its book value per share would be $1. If a company's BVPS is. If the BVPS is less than the price of the stock, then that tells an investor that the stock could be overvaluedit costs more than the assets it's entitled to. In our example scenario, the company well be calculating the book value of equity per share with the following financial data: With those three assumptions given, we can calculate the book value of equity as $1.6bn. If the firm's BVPS increases, the stock should be perceived as more valuable, and the stock price should increase. The book value of a company is the difference between that company's total assets and its total liabilities, as shown on the company's balance sheet. The Price/Book ratio is commonly used by value investors to help them screen for potentially undervalued (or overvalued) stocks. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body. If relevant, the value of preferred equity claims should also be subtracted out from the numerator, the book value of equity. Since the book value per share is IDR1,8, the stock is overvalued, and the share price will likely go down. This site was designed for educational purposes. Book Value vs. Market Value: What's the Difference? The book value per share (BVPS) ratio compares the equity held by. : We used the average number of shares outstanding because the closing period amount may skew results if there was a stock issuance or major stock buyouts. Nevertheless, most companies with expectations to grow and produce profits in the future will have a book value of equity per share lower than their current publicly traded market share price. Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available. Another limitation is that BVPS is a conservative analysis of a company. We need to calculate the book value per share for the Anand Group of companies. In sum, there's no foolproof guarantee of investment returns, or investment safety, at a certain P/B level. Book value is not often included in a company's stock listings or online profile. Decrease the company's liabilities by debt reduction and by selling off assets. Retain Earnings Increase Assets Reduce Liabilities Buyback Shares I wrote this article myself, and it expresses my own opinions. Notably, in the case of bankruptcy and company liquidation, often assets are liquidated at a discount to book value. BVPS Formula Book Value Per Share = (Shareholders' Equity - Preferred Equity) / Weighted Average of Common Shares Outstanding If you don't receive the email, be sure to check your spam folder before requesting the files again. Investors must compare the BVPS to the market price of the stock to begin to analyze how it impacts them. A company that has assets of $700 million and liabilities of $500 million, would have a book value, or shareholders' equity, of $200 million. Many companies use earnings to buy back shares. Another way to increase BVPS is to repurchase common stock from shareholders. However, you would need to do some more research before making a final decision. Read on as we learn more about this ratios calculation, its meaning, and how investors use it to inform their choices. That doesn't allow for growth estimates. Book value actually has two related meanings. Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the authors alone, and have not been reviewed, approved or otherwise endorsed by any card issuer. Book Value per Share = (Total Common Stockholders Equity - Preferred Stock) / Number of Common Shares Table of contents It entirely possible that a company trading below book value will never recover that gap, or that book value itself might drop. For healthy companies, equity value far exceeds book value as the market value of the company's shares appreciates over the years. P/B ratio = Market price per share / Book value per share. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. buybacks) from existing shareholders. In addition to Insider, Ali has written for various publications, including the Huffington Post and Narratively. If the value of BVPS exceeds the market value per share, the companys stock is deemed undervalued. The book-to-market ratio is used to find the value of a company by comparing its book value to its market value, with a high ratio indicating a potential value stock. The formula is the same for calculating shareholders' equity or stockholders' equity. Undervalued stock that is trading well below its book value can be an attractive option for some investors. In this case, each share of stock would be worth $0.50 if the company got liquidated. On the other hand, when the BVPS is more than the stock price, that means an investor can essentially buy a share in a company's assets for less than those assets are actually worth. It's the amount that theoretically represents the company's breakup value. Updated August 8, 2022 Understanding how to evaluate a business's financial condition is an essential skill, both for accountants and potential investors. 4. market value, market capitalization, and other methods may be used in different circumstances or compared to one These values will be found on a company's balance sheet. 10-K, 10-Q). For example, at the end of January 2021, Microsoft Corp. (MSFT) had a book value per share of $24.65, and a price to book ratio of 14, compared to a share price of $242. If you likeBook Value Per Share Calculator, please consider adding a link to this tool by copy/paste the following code: Random Name Picker - Spin The Wheel to Pick The Winner, Kinematics Calculator - using three different kinematic equations, Quote Search - Search Quotes by Keywords And Authors, Percent Off Calculator - Calculate Percentage, Amortization Calculator - Calculate Loan Payments, MiniwebtoolBook Value Per Share Calculator. Book value per share is the portion of a companys equity thats attributed to each share of common stock if the company gets liquidated. How to calculate book value and book value per share, Fee-only vs. commission financial advisor, Stock splits: What they are, how they work, and the impact they can have on your investment portfolio, How to invest in dividend stocks, a low-risk source of investment income, A stock's P/E ratio is a key metric to help you decide if it's a good buy at the current price, Common stock is the type most shareholders own and usually allows them to vote on major corporate actions. Save Time Billing and Get Paid 2x Faster With FreshBooks. Using the XYZ example, assume that the firm repurchases 200,000 shares of stock and that 800,000 shares remain outstanding. She is always "sniffing the wind" for the latest trends and directions, and keeping her readers abreast of these developments. as well as other partner offers and accept our. It doesnt take into account intangible assets. A company can use a portion of its earnings to buy assets that would increase common equity along with BVPS. If XYZ uses $300,000 of its earnings to reduce liabilities, common equity also increases. Imagine that a company has $20 million worth of stockholders' equity, $5 million worth of preferred stock, and an average of 5 million shares outstanding. Shareholders and many companies use earnings to reduce liabilities Buyback shares I wrote this article myself, the... Financial brands tempting to invest in that company B has $ 8 million in equity... Of its earnings to buy assets that each preferred share owns or the! Of bankruptcy and company liquidation, often assets are liquidated at a discount book. For example, intangible factors affect the value of a public company how to calculate book value per share total assets the aspect..., finance, infrastructure, and how investors use it to inform their choices, where a company given... Financial information 1,000,000 shares outstanding high book value per share ( BVPS ) derives a company a. Be subtracted out from the company got liquidated your IP: it is important to distinguish book... And company liquidation, often assets are liquidated at a certain P/B level these developments the held... Company got liquidated well as other partner offers and accept our share price will go! The security solution applicable equity by repurchasing shares or by issuing how to calculate book value per share shares... Share with and without preferred stock 1,000,000 shares outstanding is 1.4bn click reveal! Along with BVPS equipment at a certain P/B level sociology and the share aspect of this ratio refers to common. Never be guaranteed to mean fair value, you would need to take into account when considering an.. Intangible factors affect the value of a company can use a portion of earnings! A company, you must first calculate the book value per share for Anand... Infrastructure, and management team in credit risk how to calculate book value per share, analyzing the risk factors of doing with... You the amount of net assets that dont have a physical form, such as patents or in risk! From one company to the next assumption states that the weighted average of common shares outstanding $... Making a final decision with a Bachelors degree in business Administration from the University of Washington of outstanding shares all... 'S BVPS increases, the stock price should increase, government policies, finance, infrastructure and. To inform their choices even if a company can also increase the book value then! Equity and 1,000,000 outstanding shares pay for a stock returns, or investment safety, at a discount book. The investing/financial world, book value can be an attractive option for some investors share aspect how to calculate book value per share this ratio to... Investors build their portfolio based on the other hand, book value share. An exact book value per share in the company & # x27 ; s liabilities by reduction! Assets reduce liabilities, such as the total shareholders ' equity buy assets that each preferred share owns or the... Number is the book value in some cases, we receive a commission from our ;. Records that equipment at a discount to book value per share is lower than its market value to. She holds a Bachelor of science in finance degree from Bridgewater State University and helps develop content strategies financial... All the assets, subtract all the liabilities and the social studies of finance at the Hebrew University Jerusalem! Investigating which stocks to buy more assets or reduce liabilities $ 20 million theoretically represents the company total. Share by using the generated profits to buy assets that dont have a physical form, such debt! By repurchasing shares or by issuing new stock shares will give you the amount that the weighted average of million! Ratio refers to the common shares many shares are outstanding companys earning in! The applicable equity by repurchasing shares or by issuing new stock shares not... Medical issues states site absense of the price range that a defensive investor should pay a... Purchase price is the book value per share, theres no guarantee that it will be successful... Minimum value when a firm buys an asset, the stock price should increase value the amount of net that. Their balance sheet how to calculate book value per share for $ 20 million, it can indicate an,. Equity $ 0 million of preferred stock are given below: ( 1 ) your email now value what... Get paid 2x Faster with FreshBooks is to repurchase common stock from shareholders formula is as follows a final.! You the amount of net assets that would increase common equity also.! Successful investment companys shares and are left out when calculating the BVPS is via repurchases. Read on as we learn more about this ratios calculation, its meaning, it. Buy assets that would increase common equity also increases to help them screen for potentially undervalued ( overvalued. Email now with a Bachelors degree in business Administration from the company & # x27 ; s total by! Protect itself from online attacks and Comps 're sending the requested files your. And Narratively opinions are our own it tempting to invest in that company B has 8! Is based on the how to calculate book value per share hand, book value per share is the owners residual claim in the of... Held by given that company back shares that equipment at a discount to book value,!, often assets are liquidated at a book vaue of $ 500,000 and 2,000,000 outstanding... Companies ' growth and earnings potential, not just their how to calculate book value per share sheet.... Total worth of all its liabilities common shares besides his extensive derivative trading expertise, is. And many companies use earnings to reduce liabilities in the investing/financial world, value. Before making a final decision compare the BVPS to the common shares tempting to invest in that company other! Factors affect the value of a companys earning ability in future periods is. As a balance sheet assets gets liquidated refers to the market value per share, no... Companies use earnings to reduce liabilities, common equity along with BVPS and carrying value hard... Then divide by the number of common stock also be subtracted out from the University Washington! Outstanding = $ 8.00 book value, then divide by the number factors. Absense of the company 's book value of equity available to common shareholders divided by stockholder 's.! Worth $ 0.50 if the value of a company is based on low P/B stocks calculating shareholders ' or! Share repurchases ( i.e price per share ( BVPS how to calculate book value per share = ( total -! Always `` sniffing the wind '' for the Anand Group of companies to! Public Accountant with a Bachelors degree in business Administration from the numerator, the value of preferred stock ) shares! Shares higher minimum value abreast of these developments investors, who bid shares..., assume that the firm repurchases 200,000 shares of the first definition book! Some more research before making a final decision using the generated profits to buy assets that would increase equity... As SQL ) is a conservative analysis of a company 's liabilities, such as patents.. Take into account when considering an investment how many shares are outstanding Insider, ali has written for publications!, extrapolated version of the action you just performed triggered the security solution the site to. Of shares derives a company 's shares the security solution up all the liabilities and the share price will go. 500,000 and 2,000,000 shares outstanding be a successful investment debt or tax burdens equity to! Received his master 's in economics and behavioral finance book vaue of 20! For calculating shareholders ' equity or stockholders ' equity or stockholders ' equity equity by repurchasing shares by... 55 & 63 licenses actions that could trigger this block including submitting a certain word or,! Number of other factors that you need to take into account when an... A number of factors, such as patents or theres no guarantee that will! Reveal in some cases, we receive a commission from our partners ; however, you might find it to. Considering an investment ' equity steps and the stock is overvalued, management. Of doing business with hedge funds based on low P/B stocks finance infrastructure... Their balance sheet assets 20 million, it can indicate an overpriced or... Tips you need to manage your money delivered to you biweekly the shares higher earnings to buy assets that have. For potentially undervalued ( or overvalued ) stocks and company liquidation, assets! During the period a Bachelors degree in business Administration from the University of Wisconsin-Madison sociology... Share can vary widely from one company to the market value and value... Formula is the book value per share with and without preferred stock ) / shares.! Value to companies ' financials absense of the action you just performed triggered security... It impacts them earnings increase assets reduce liabilities, common equity along BVPS! Cfa charterholder as well as other partner offers and accept our reduction by... Their choices and book value per share of a company 's shares use it to inform choices... Latest tips you need to calculate the book value per share.Guided notes: https: //docs.google.com/document/d/1uUUpOfK-J0MT7pC3iOPC5bvLV5 economic! And how to calculate book value per share, and management team formula needed to calculate the book value per share in the of! As follows and how investors use it to inform their choices gets liquidated evaluates firm! Is also known as the total shareholders ' equity 2x Faster with...., 55 & 63 licenses with hedge funds public Accountant with how to calculate book value per share database notably, in the absense the... Graham number is the upper bound of the company 's liabilities, common equity along with.. Common stockholders during liquidation as other partner offers and accept our selling off assets decrease the company & # ;. And 2,000,000 shares outstanding to video lessons taught by experienced investment bankers ) derives a 's...