Question

Lucky Louie just inherited $50,000 from his great aunt, has $1,500 in his checking account, owns a car with a value of $8,000, and has $20,000 in his 401(k) at work. Louie owes $6,000 on his car, $12,000 on school loans and $3,000 on his credit card. What is Louie's net worth?

Answer 1

Answer:

$58,500

Explanation:

Net worth is the difference between total assets and total liabilities.

I.e network = Asset - Liabilities

For Louie: Assets

Inheritance            $  50,000.00

Checking account  $    1 ,500.00

Car                          $    8,000.00

403 (k)                      $  20,000.00

Total                          $ 79,500.00

Liabilities            

Car loan                       $ 6,000.00

School fee loan           $ 12,000.00

credit card                    $ 3, 0000.00

Total                              $21, 000.00

Net worth = $ 79,500- $21,000

                 =$58,500