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assignments for the corresponding assignment. Use the following balance sheet and cash flow information to determine the net...

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Finance

assignments for the correspondingassignment.

  1. Use the following balance sheet and cash flow information todetermine the net worth and net surplus for an individual in arecent month:

Liquid Assets $15,000

Home Value $220,000

Investment assets: $120,000

Personal Property $30,000

Total assets: $385,000

Short Term Debt: $7000 ($250 amonth)

Monthly Mortgage Payment $1400 on a$180,000 mortgage

Total Debt: $187,000

Monthly Gross Income: $11,000

Monthly Disposable Income $ 4000

Monthly Expenses: $7000

  1. Now that the individual in question 1 has a betterunderstanding of their situation, let’s analyze further. Given thebalance sheet and cash-flow statement information in question 1,calculate the following ratios see page 87:

Liquidity Ratio

Asset-to-Debt Ratio

Debt-to-Income Ratio

Debt payments-to-disposable incomeratio

Investment assets-to-total assetsratio

Answer & Explanation Solved by verified expert
4.1 Ratings (691 Votes)
Q1 1Networth It is the difference of Total assets and Total liabilities 385000 187000 198000 2Net surplus it is the difference of Monthly gross income and expenses 11000 7000 4000 Q2    See Answer
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