Assets and Liabilities

Front

What are Assets?

Back

Assets are resources owned by an individual or entity that have economic value and can provide future benefits.

Front

What are Liabilities?

Back

Liabilities are financial obligations or debts that an individual or entity owes to others.

Front

What is Net Worth?

Back

Net Worth is the value of all assets minus the value of all liabilities.

Front

What is the formula to calculate Net Worth?

Back

Net Worth = Total Assets - Total Liabilities.

Front

Give examples of Assets.

Back

Examples of Assets include cash, real estate, vehicles, stocks, and bonds.

Front

Give examples of Liabilities.

Back

Examples of Liabilities include loans, mortgages, credit card debt, and unpaid bills.

Front

What is the difference between current and long-term liabilities?

Back

Current liabilities are obligations due within one year, while long-term liabilities are due after one year.

Front

What is a balance sheet?

Back

A balance sheet is a financial statement that summarizes an entity's assets, liabilities, and equity at a specific point in time.

Front

How do you calculate total liabilities?

Back

Total Liabilities = Current Liabilities + Long-term Liabilities.

Front

What is an example of a current liability?

Back

An example of a current liability is accounts payable.