Shareholders’ Equity

Shareholders’ Equity, often referred to as shareholder equity, represents the residual interest in the assets of a corporation after deducting liabilities. It is calculated as the sum of share capital, retained earnings, and additional paid-in capital, minus treasury stock. This figure is crucial for assessing a company’s financial health and is reported on the balance sheet. Shareholders’ Equity is a key component in evaluating a company’s net worth.