How Do I Improve My Net Asset Value?

Net asset value is the difference between the total value of an asset and the liabilities it contains. It is usually applied in three areas: (1) For mutual funds, it refers to the total value of the mutual fund investment portfolio minus liabilities. Mutual funds typically calculate their NAV daily. (2) For corporate valuation, total assets minus total liabilities. The net asset value is usually calculated based on the book value of assets and liabilities, usually based on the unit of each share, for example: a company's net asset value per share is 1 yuan, that is, assets can be divided into 1 yuan per share. (3) Personal net worth is often used to measure worth. ^[1]

net asset value

Net asset value is the difference between the total value of an asset and the liabilities it contains. It is usually applied in three areas: (1) For mutual funds, it refers to the total value of the mutual fund investment portfolio minus liabilities. Mutual funds typically calculate their NAV daily. (2) For corporate valuation, total assets minus total liabilities. The net asset value is usually calculated based on the book value of assets and liabilities, usually based on the unit of each share, for example: a company's net asset value per share is 1 yuan, that is, assets can be divided into 1 yuan per share. (3) Personal net worth is often used to measure worth. ^[1]

(I) Relationship between net asset value and assets

After analyzing each asset, it can be known that the net asset value is calculated by subtracting the respective allowance account balance from the original asset value. At the same time, the net assets value together constitute the total actual assets of the enterprise, rather than the total amount of nominal assets, forming the total assets in the balance sheet. The assets in the balance sheet are listed in net value, which more truly reflects the asset composition of the enterprise and can provide more reliable information for users of the report.

(II) Relationship between net asset value and net assets

The net asset value is equal to the original value of the assets minus the various provisions. According to the double-entry bookkeeping principle, the corresponding increase in expenditures during the provision of various provisions will affect the profit of the enterprise and thus the amount of the company's net assets; on the other hand, the net assets) assets * liabilities At the same time, the net asset value directly affects the amount of net assets.