UK Accounting Glossary
The book value of an asset or group of assets is the price at which they were originally acquired, in many cases equal to purchase price.
The value of a security or asset as entered in a firm’s books.
The book value of an asset or group of assets is the price at which they were originally acquired, in many cases equal to purchase price. Book value is therefore relevant in-so-far as it forms the basis of various calculations.
e.g. of nominal capital gains (current value divided by book value), of amortised value (book value adjusted for depreciation) and of several financial ratios (e.g. price to book value [P/BV]).
Liabilities are recorded at book value so that the book value of net worth is zero.
The insured value of the sports car was greater than its book value.
Stocks are selling at more than three times their book value.
An organisations capitalised value may be greater or less than its book value.
According to the MSCI, World financials currently trade at 1.2 times x book value.
We have to assume that the owners of those enterprises acquired them at book value.
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Definitions for Book Value are sourced/syndicated and enhanced from:
This glossary post was last updated: 26th December 2018.