Definition of net worth
This query is : Resolved
22 October 2012
Hi all,
Please advise whether following is correct formula to arrive at Net worth:
Share Capital plus Reserves and Surplus (incl. credit balance of P&L Account) less debit balance of p&l account
I am taking the following base "The word “Net worth” as defined under the Companies Act, 1956 as sum of paid up capital and free reserve. “Free Reserves” means all reserves created out of profits and share premium but do not include reserves created out of revaluation of assets, write back of depreciation provisions and amalgamation."
Rgds,
Ramesh
Please advise whether following is correct formula to arrive at Net worth:
Share Capital plus Reserves and Surplus (incl. credit balance of P&L Account) less debit balance of p&l account
I am taking the following base "The word “Net worth” as defined under the Companies Act, 1956 as sum of paid up capital and free reserve. “Free Reserves” means all reserves created out of profits and share premium but do not include reserves created out of revaluation of assets, write back of depreciation provisions and amalgamation."
Rgds,
Ramesh
CA Ayush Agarwal
(Expert)
22 October 2012
Yes, You are rite.
Message likes :
1 times
CA BHARATH KUMAR
(Expert)
22 October 2012
absolutely correct
SANYAM ARORA
(Expert)
22 October 2012
Yes you are right
CA Lokesh Pokharna
(Expert)
22 October 2012
correct, but consider true aspects for analysis purposes
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