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How to Calculate Net Worth of a Company? | Definition | Top Example

30,775 views November 10, 2019 7:58

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ChannelWallStreetMojo

Description from the creator

In this video on Net Worth of Company, we discuss its formula, calculation along with practical example.

๐–๐ก๐š๐ญ ๐ข๐ฌ ๐๐ž๐ญ ๐–๐จ๐ซ๐ญ๐ก ๐จ๐Ÿ ๐š ๐‚๐จ๐ฆ๐ฉ๐š๐ง๐ฒ?
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The company's Net Worth is nothing but firm's Book value or shareholder equity. The company's net worth is the value of the assets after paying off its debts.

๐๐ž๐ญ ๐–๐จ๐ซ๐ญ๐ก ๐จ๐Ÿ ๐š ๐‚๐จ๐ฆ๐ฉ๐š๐ง๐ฒ ๐…๐จ๐ซ๐ฆ๐ฎ๐ฅ๐š
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Net Worth of the Company = Total Assets โ€“ Total Liabilities.

๐„๐ฑ๐š๐ฆ๐ฉ๐ฅ๐ž ๐จ๐Ÿ ๐๐ž๐ญ ๐–๐จ๐ซ๐ญ๐ก ๐จ๐Ÿ ๐š ๐‚๐จ๐ฆ๐ฉ๐š๐ง๐ฒ
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Let's consider Mr B needs to calculate Net worth of a company PQR. It has following the information -

2016 (In US $) 2015 (In US $)
Total Assets (A) 62,15,000 63,10,000
Total Liabilities (B) 4,15,000 3,10,000

Net Worth (2016) = 6215000 - 415000 = 5800000

Net Worth (2015) = 6310000 - 310000 = 6000000

To know more about ๐๐ž๐ญ ๐–๐จ๐ซ๐ญ๐ก ๐จ๐Ÿ ๐š ๐‚๐จ๐ฆ๐ฉ๐š๐ง๐ฒ, you can go to this ๐ฅ๐ข๐ง๐ค ๐ก๐ž๐ซ๐ž:- wallstreetmojo.com/net-worth/

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About this tutorial

WallStreetMojo published this 7:58 video tutorial on November 10, 2019. It has been watched 30,775 times on YouTube.

Category
Education
Duration
7:58
Published
November 10, 2019
Views
30,775
Likes
224

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