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.