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Question
Complete the net worth statement by determining the total assets and total liabilities. What is the net worth?
Responses
A$200
$200
B$2,000
$2,000
C$10,700
$10,700
D$12,700
To determine the net worth, we need to calculate the difference between the total assets and total liabilities.
Total assets in the net worth statement are given as $10,000 for cash, $1,000 for accounts receivable, and $1,700 for inventory. Therefore, the total assets are $10,000 + $1,000 + $1,700 = $12,700.
Total liabilities in the net worth statement are given as $5,000 for accounts payable. Therefore, the total liabilities are $5,000.
To calculate the net worth, we subtract the total liabilities from the total assets: $12,700 - $5,000 = $7,700.
Therefore, the net worth is $7,700.
The correct answer is D$12,700.