Book value

(1) The value of an asset as reported in a company's annual financial statements. This will be at the asset's historic value less depreciation, which may differ from the asset's market or replacement value.
(2) The net worth, or liquidation value, of a business. Book value of a stock is determined from a company´s balance sheet by adding all current and fixed assets and then deducting all debts, other liabilities and the liquidation price of any preferred issues. The sum arrived at is divided by the number of common shares outstanding and the result is book value per common share.