Dr. Dre ranked second on last year’s Forbes Five list of hip-hop’s wealthiest artists with a net worth of $550 million. Yet a year later, after selling Beats to Apple AAPL +0.92% for $3 billion, his fortune sits at $700 million in this year’s accounting.

To the casual observer, the math may not seem to make sense—particularly given that Dr. Dre anointed himself hip-hop’s first billionaire last May—so, in the interest of transparency and understanding, let’s take a closer look, starting at the very beginning.

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