Building Wealth Review

Define assets

• Assets that add to net wealth

• The loss of value of an asset over time

• Anything an individual or business owns that has commercial or exchange value

• A financial statement showing a snapshot of the assets, liabilities, and net worth of an individual

Define Balance Sheet

• A financial statement showing a snapshot of the assets, liabilities, and net worth of an individual

• Money an individual or organization owes.

Define Depreciation

• The difference between the total assets and total liabilities of an individual.

• The loss of value of an asset over time.

Define Net worth

• The loss of value of an asset over time.

• The difference between the total assets and total liabilities of an individual.

• Assets that add to net wealth.

• Money an individual or organization owes.

Wealth-building assets

• The loss of value of an asset over time

• Anything an individual or business owns that has commercial or exchange value

• Assets that add to net wealth

• Anything an individual or business owns that has commercial or exchange value

Name two assets that are likely to depreciate in value over time

• Land, Houses

• Computers, Video Games

Give one reason why houses are generally considered a wealth-building asset.

• Because it has a mortgage

• A house is not a wealth-building asset.

• A house is a wealth-building asset when it appreciates in value over time.

• A house is not wealth-building asset it is a liability.

If your total liabilities increase without a change in assets, how will it impact net worth?

• Net worth Decreases

• Net worth Increases

What is the formula for net worth?

• Assets - Liabilites= Net worth

• Assets + Liabilities + debt= Net worth

• Assets+ Liabilities= Net Worth

Which one does not belong to liability?

• Mobile Phone Bill

• Bank Loan

• Bank Balance

• Owed To Friends