Math Review

Front

What is the definition of net worth?

Back

Net worth is the total value of an individual's assets minus their liabilities.

Front

How do you calculate net worth?

Back

Net worth = Total Assets - Total Liabilities.

Front

If Abby's home is worth $115,000 and she has a mortgage of $98,000, what is the equity in her home?

Back

Equity = Home Value - Mortgage = $115,000 - $98,000 = $17,000.

Front

What is an asset?

Back

An asset is anything of value or a resource owned by an individual or entity.

Front

What is a liability?

Back

A liability is a financial obligation or debt that an individual or entity owes to another party.

Front

If Abby has $900 in her checking account, how does this affect her net worth?

Back

It increases her net worth as it is considered an asset.

Front

What is the value of Abby's car?

Back

$11,000.

Front

What is the total amount Abby owes on her debts?

Back

Total debts = Mortgage + Car Loan + Credit Card = $98,000 + $5,200 + $2,300 = $105,500.

Front

If Abby has $300 in gift cards, how does this contribute to her net worth?

Back

Gift cards are considered assets and increase her net worth.

Front

What is the formula to find total assets?

Back

Total Assets = Value of Home + Value of Car + Checking Account + Gift Cards.