Net worth

Front

What is net worth?

Back

Net worth is the difference between a person's total assets and total liabilities. It indicates the financial health of an individual or entity.

Front

How do you calculate net worth?

Back

Net worth = Total Assets - Total Liabilities.

Front

What are assets?

Back

Assets are valuable resources owned by an individual or company, such as cash, real estate, and investments.

Front

What are liabilities?

Back

Liabilities are financial obligations or debts that an individual or company owes to others, such as loans and credit card debt.

Front

If assets are $50,000 and liabilities are $30,000, what is the net worth?

Back

Net worth = $50,000 - $30,000 = $20,000.

Front

If assets are $20,000 and liabilities are $50,000, what is the net worth?

Back

Net worth = $20,000 - $50,000 = -$30,000.

Front

What does a positive net worth indicate?

Back

A positive net worth indicates that assets are greater than liabilities, meaning the individual or entity is financially healthy.

Front

What does a negative net worth indicate?

Back

A negative net worth indicates that liabilities exceed assets, meaning the individual or entity is in debt.

Front

Which of the following is an example of an asset: savings, credit card debt, or student loan?

Back

Savings is an example of an asset.

Front

What is the net worth of someone with $15,000 in assets and $10,000 in liabilities?

Back

Net worth = $15,000 - $10,000 = $5,000.