Question

Consider a family that has one working parent, a stay‐at‐home parent, and three children. Two of the children are in elementary school, and the youngest child is in Pre‐Kindergarten. They have a house, a car, and a minivan, and they carry some credit card debt.

The house is valued at $89,000 with a mortgage balance of $80,000.
The car is worth $15,000. The family owes $15,000 on this auto loan.
The minivan is worth $20,000. The family owes $16,000 on this auto loan.
They financed new household furnishings valued at $5,000. The family owes $4,500 on this loan.
They have $15,000 in their retirement account.
They have $1,500 in emergency savings, $1,000 in savings, $500 in checking, and $1,500 in a CD.
They have $200 in cash.
Balances on the credit cards total $15,000.
The family pays $500 per month for school loans; the current balance is $25,000.
The family pays $350 per month for Pre‐Kindergarten tuition.
All of the children are on soccer teams, which costs $100 per month.

For this assignment, use the information above to answer the following questions about the family's net worth:

Calculate the family's total assets.
Calculate the family's total liabilities.
Calculate the family's net worth, and identify whether the net worth is positive or negative.
List any expenses that would not fall on the balance sheet.

Answer 1

1. The family's total assets = $148,700.

2. The family's total liabilities = $155,500.

3. The family's net worth is ($6,800), which is $148,700 - $155,500.

What is the family's net worth?

The family's net worth is the excess of its total assets minus its total liabilities.

The net worth can be positive or negative.  It is negative when the total liabilities exceed the total assets.

Data and Calculations:

                                         Assets       Liabilities

House on mortgage      $89,000       $80,000

Car on auto loan               15,000          15,000

Minivan on auto loan      20,000          16,000

Furnishings                        5,000           4,500

Retirement account         15,000

Emergency savings           1,500

Savings                              1,000

Checking account              500

CD                                     1,500

Cash                                    200

Credit cards                                         15,000

School loan                                         25,000

Total                          $148,700      $155,500

4. Thus, the expenses that would not fall on the balance sheet are:

• Payment for school loans of $500 per month
• Pre-Kindergarten tuition of $350 per month
• Payment for soccer teams of $100 per month.

Learn more about computing net worth at https://brainly.com/question/12371230

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