What is the net book value of a non current asset represent? Does the network value...

What is the net book value of a non current asset represent? Does the network value represent the market value of the asset?

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Expert Solution

Part 1

Net book value of non current asset indicates the book value of non-current asset after deducting the accumulated depreciation.

Let's take one example to understand your concept.
Equipment	800,000
Accumulated depreciation—Equipment	150,000
Net book value of equipment	650,000

Part 2

Net worth indicates the net assets available for shareholders. Net worth can be calculated by deducting the total liabilities from total assets. Net worth is known as book value of company.

Market value of the company is market value of per share multiplied by number of common shares outstanding.

In simple words, net worth is book value of assets available for shareholders. Market value of company is market value of assets available for shareholders.

ekkarill92 answered 1 year ago

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