JOSH:$$Mia$,$ do you have a second to help me with my reading of Extensive$$s annual report? I$$ve come across several unfamiliar terms, and I want to make sure that I$$m interpreting the data and management$$s comments correctly.

For example, one of the footnotes to the financial statements uses $$the book value of Extensive$$s shares,$$ and then in another place, it uses $$Economic Value Added.$$ I$$ve never encountered those terms before. Do you know what they$$re talking about?

MIA:$$Yes$,$ I do$.$ Let$$s see if we can make these terms make sense by talking through their meaning and their significance to investors.

The term book value$$has several uses. It can refer to a single asset or the company as a whole. When referring to an individual asset, such as a piece of equipment, book value refers to the asset$$s$,$ adjusted for any accumulated depreciation or amortization expense. The$$value$,$ or difference between the machine$$s historical cost and its accumulated depreciation expense, is called its book value.

In contrast, when the term refers to the entire company, it means the total value of the company$$s$$as reported in the firm$$s$.$