ECONOMICS

Detailed explanation-1: -To calculate a company’s net tangible assets, subtract its par value of preferred shares and any intangible assets, such as goodwill, patents and trademarks, from its total assets.

Detailed explanation-2: -Net Tangible Assets (NTA) is the value of all physical (“tangible”) assets minus all liabilities in a business. In other words, NTA is the total assets of a company minus intangible assets and total liabilities.

Detailed explanation-3: -Goodwill Formula = Consideration paid + Fair value of non-controlling interests + Fair value of equity previous interests – Fair value of net assets recognized.

Detailed explanation-4: -For example, if a company has total assets of $1 million, total liabilities of $100, 000, and intangible goodwill of $100, 000, its net tangible asset amount is $800, 000. This is derived by subtracting $200, 000 (the sum of both liabilities and goodwill) from the value of the company’s total assets of $1 million.

Detailed explanation-5: -The formula to calculate net tangible assets is as follows: Net Tangible Assets = Fair Market Value of Tangible Assets – Fair Market Value of Total Liabilities. The result of this equation can help show whether your business’s market share price is under or overvalued.