What is Net Worth?

Net worth is the measure of a company’s or individual’s actual worth, accounting for assets as well as debts. The net worth of a company or individual is simply their assets minus their liabilities, or the value of the things they own minus the amount of debt they have.

How to calculate net worth:

Net Worth = Total Assets – Total Liabilities

For accounting purposes, what does net worth mean? Used as the primary indicator of the value of a company, net worth provides insights into investment successes and failures and can be indicative of the financial health of a company or individual.

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