net worth
A corporation's net worth is the retained earnings, or the amount left after dividends are paid, plus the money in its capital accounts, minus all of its short- and long-term debt. Its net worth is reported in the corporation's 10-K filing and annual report.
Net worth may also be called shareholder equity, and it's one of the factors you consider in evaluating a company in which you're considering an investment.
To figure your own net worth, you add the value of the assets you own, including but not limited to cash, securities, personal property, real estate, and retirement accounts, and subtract your liabilities, or what you owe in loans and other obligations.
If your assets are larger than your liabilities, you have a positive net worth. But if your liabilities outweigh your assets, you have a negative net worth. When you apply for a loan, potential lenders may want to see your net worth statement.
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