In any business, shareholder equity is calculated by subtracting the total liabilities of the company from its assets. This report is used very commonly from analyst to determine the financial health of the business. With the help of this report, the true economic value of the company is known. The amount that the shareholders will get when all the assets of the company are liquidated can also be determined through the shareholder equity report. The shareholder equity reports state whether the equity is positive or negative. The report states the positive equity if a company has enough assets to cover…
