Net worth

Which of the following modifications to the list of assets and liabilities below would result in an increase in net worth? Cash of $300. Car valued at $28,000. Car loan of $22,000. Motorcycle valued at $6,000. Savings of $2,000. Credit card balances of $4,000. Student loan of $10,000.

All of the above (Putting $100 in savings Paying $100 on credit cards and Getting paid $100)

Asset

An asset is an item that is owned and has value.

Which of the following modifications to the list of assets and liabilities below would result in a negative net worth? House valued at $90,000. Mortgage owed $78,000. Car valued at $11,000. Car loan of $5,000. Student loan of $13,700. Stocks valued at $2,500. Savings of $3,000.

Borrowing $10,000 more in student loans.

Liquid assets

Cash and savings

Which of the following is a liability?

Credit card balance

Determine your current financial situation

Do you have a job? What are your expenses? Do you owe people money? Do you have money saved in the bank?

The rare coin collection your grandmother gave you is part of your liabilities.

F

The following table shows the assets and liabilities of the Smith family in 2005 and 2009. Based on the table, which of the following is true?

From 2005 to 2009, both assets and liabilities decreased.

Long-term liabilities

Home mortgage, auto loan

Use assets

Home, auto, personal possessions, durable goods

The amount of money invested in a retirement fund is an example of which of the following?

Investment asset

Over the period of a year, Julie's net worth decreased. Which of the following could be true?

Julie's assets decreased by more than her liabilities.

Liability

Liability is a responsibility, an obligation, or a debt

Mary took out a loan to buy a $30,000 boat but had $2,000 cash to put down.Which of the following is true?

Mary increased both assets and liabilities.

Current liabilities

Medical bills, taxes, credit card and charge accounts

When it goes on sale for $1,600, Mikah buys a new plasma television that is valued at $1,800. He takes $300 from his savings account to use as a down payment and finances the rest. Choose the true statement.

Mikah's assets increased by $1,500.

What is the difference between assets and liquid assets?

NOT Assets are money gained from your job, while liquid assets are money gained from sources such as investments or inheritances.

Which of the following modifications to the list of assets and liabilities below would result in a positive net worth? Home owned $105,000. Mortgage owed $100,000. Car valued at $26,000. Car loan of $22,000. Investment fund of $4,500. Savings of $1,500. Credit card balance of $15,000.

NOT Lowering mortgage by $1,000.

Mr. Chavez has assets of $250,000 and liabilities of $18,000. He decides to finance the entire amount of the purchase of a car valued at $26,000. Which of the following is true?

NOT Mr. Chavez increased both his assets and net worth.

The amount of money in a savings account is an example of which of the following?

NOT long term asset

Which of the following modifications to the list of assets and liabilities below would result in a net worth of $100,000? Recreational Vehicle valued at $110,000. Car valued at $27,000. Medical bills totaling $8,700. Loan balance of $80,000. Savings of $5,000. Retirement fund of $50,000. Credit card balance of $2,300.

NOT recreational vehicle value decreasing to $100,000

Which of the following is an example of increasing both current liability and use assets?

NOT selling a motorcycle to pay off a debt

Net worth

Net worth is the difference between assets and liabilities. Assets - liabilities = net worth

Which of the following could be true if one decreases their long term liability and increases their liquid assets?

Paid down mortgage and received a cash prize.

Over the period of a year, Sam's net worth increased. Which of the following could be true?

Sam's assets increased by more than his liabilities.

Investment assets

Securities and invested funds

The car owned by a person is part of his or her ____.

Use assets

You have a car that is valued at $12,000. The balance that you owe on the car loan is $7,000. You lose your job and can not afford to make payments on your loan so you sell the car for $9,000 and pay off the loan. Explain how your net worth is affected by your actions.

You have reduced your net worth. Before selling the car, your net worth is $12,000 - $7,000 = $5,000. After selling the car and paying off the loan, it is $2,000.

Ben owns a townhome valued at $195,000, but still owes $120,000 on the loan. Ben has $5,000 in savings and a balance of $1,400 on his credit cards. There is a balance of $20,000 owed on Ben's car which is valued at $38,000. What is Ben's net worth?

96,600