Book value per share of stock represents the amount of equity the shareholder of one share of stock has in the net assets of the company.

Question

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Book value per share of stock is calculated by dividing the total shareholder's equity by the number of outstanding shares. This gives the amount of equity that each shareholder has in the company's assets. Therefore, it represents the amount of equity that the shareholder of one share of stock has in the net assets of the company.

Book Value Per Share of Stock Represents the Amount of Equity