HOMEWORK 2

 Answer the following questions:

  1. Calculating Balance Sheet Amounts. Based on the following data, compute the total assets, total liabilities, and net worth.
    Liquid assets $4,670                                                                  Household assets $93,780
    Investment assets 26,910                                                          Long-term liabilities 76,230
    Current liabilities 2,670
  2. Preparing a personal Balance Sheet. Use the following items to  prepare a balance sheet and a cash flow statement. Determine the total  assets, total liabilities, net worth, total cash inflows, and total cash  outflows.
    Rent for the month, $650
    Monthly take-home salary, $1,950
    Cash in checking account, $450
    Savings account balance, $1,890
    Spending for food, $345
    Balance of educational loan, $2,160
    Current value of automobile, $7,800
    Telephone bill paid for month, $65
    Credit card balance, $235
    Loan payment, $80
    Auto insurance, $230
    Household possessions, $3,400
    Stereo equipment, $2,350
    Payment for electricity, $90
    Lunches/parking at work, $180
    Donations, $70
    Home computer, $1,500
    Value of stock investment, $860
    Clothing purchase, $110
    Restaurant spending, $130
  3. Calculating Financial Ratios. The Fram family has liabilities of  $128,000 and a net worth of $340,000. What is their debt ratio? How  would you assess this?
  4. Determining Budget Variances. Fran Bowen created the following budget:
    Food, $350
    Clothing, $100
    Transportation, $320
    Personal expenses and recreation, $275
    Housing, $950

    She  actually spent $298 for food, $337 for transportation, $982 for  housing, $134 for clothing, and $231 for personal expenses and  recreation. Calculate the variance for each of these categories, and  indicate whether it was a deficit or surplus.

  5. Future Value of Savings. Kara George received a $4,000 gift for  graduation from her uncle. If she deposits the entire amount in an  account paying 3 percent, what will be the value of this gift in 15  years?

Thanks for installing the Bottom of every post plugin by Corey Salzano. Contact me if you need custom WordPress plugins or website design.

CategoriesUncategorized