book value per share of stock
Financial Dictionary — Accounting Fundamentals
Definition
Book value per share of stock A company's total equity (excluding preferred stock) divided by the number of shares of common stock outstanding.
Use cases, Example & Why it matters
Use cases
- Used in day-to-day bookkeeping and journal entries to record transactions correctly.
- Used when preparing trial balances and reconciling accounts.
- Used when preparing trial balances and reconciling accounts.
Example
- Example: Accountants use **book value per share of stock** when recording transactions and preparing the trial balance.
Why it matters
- Why it matters: Ensures accurate records, supports reliable reporting, and reduces posting and reconciliation errors.