book value

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Explanation of "Book Value"

Definition:
"Book value" is a term used in finance and accounting. It refers to the value of an asset (like equipment, buildings, or investments) as it appears on a company's balance sheet. This value is calculated by taking the original cost of the asset and subtracting any depreciation (the loss of value over time due to wear and tear or age).

Usage Instructions:

• When to use: Use "book value" when discussing the financial worth of assets in a company. It’s often used in business, investing, and accounting contexts.
• How to use: You can say "the book value of the asset is..." followed by the amount.

Example:

• "The book value of the company's machinery is $50,000 after accounting for depreciation."

Advanced Usage:

• In investment discussions, you might compare a company's book value to its market value (the price it would sell for in the market) to assess whether a stock is undervalued or overvalued.

Word Variants:

• Book Value Per Share: This is the book value of a company divided by the number of outstanding shares. It gives investors an idea of the value of each share based on the company's assets.

Different Meanings:

• In general use: "Book value" can sometimes refer to the theoretical value of something beyond just financial terms, like the worth of a collection of books or other items based on their original cost.

Synonyms:

• Net Asset Value: This can often be used interchangeably with book value, especially in investment contexts.
• Carrying Value: Another term that means the same as book value, referring to how much an asset is worth on the balance sheet.

Idioms and Phrasal Verbs:

• While there aren't specific idioms or phrasal verbs that directly use "book value," you might come across phrases like "write down" or "depreciate," which relate to the concept of adjusting the book value of an asset.

Conclusion:

Understanding "book value" is important for anyone interested in finance, investments, or accounting.

Academic

Noun

1. the value at which an asset is carried on a balance sheet; equals cost minus accumulated depreciation