Book value per share is determined by:
A) deducting liabilities from assets and dividing the remainder by owner's equity.
B) deducting liabilities from assets and dividing the remainder by the number of shares of stock outstanding.
C) dividing liabilities by the number of shares of stock outstanding.
D) dividing assets by the number of shares of stock outstanding.
E) dividing the sum of assets and owner's equity by the number of shares of stock outstanding.

Question

Quizplus · Accepted Answer

Book value per share is the net assets of a company divided by the number of shares outstanding. This is essentially the same as deducting liabilities from assets and dividing the remainder (owner's equity) by the number of shares outstanding, as shown in option B.

Book Value Per Share Is Determined By