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Which of the following modifications to the list of assets and liabilities below would result in a net worth of 100,000 Recreational Vehicle valued at 110,000. Car valued at 27,000 Medical bills totaling 8,700 Loan balance of 80,000. Savings of 5,000 Retirement fund of 50,000 Credit card balance of 2,300 a. recreational vehicle value decreasing to 100,000 b. borrowing 10,000 more in loans c. withdrawing 20,000 from the retirement fund d. adding 1,000 in credit card debt Please select the best answer from the choices provided A B D

Question

Which of the following modifications to the list of assets and liabilities below would result in a net worth of 100,000
Recreational Vehicle valued at 110,000.
Car valued at 27,000
Medical bills totaling 8,700
Loan balance of 80,000.
Savings of 5,000
Retirement fund of 50,000
Credit card balance of 2,300
a. recreational vehicle value decreasing to 100,000
b. borrowing 10,000 more in loans
c. withdrawing 20,000 from the retirement fund
d. adding 1,000 in credit card debt
Please select the best answer from the choices provided
A
B
D

Which of the following modifications to the list of assets and liabilities below would result in a net worth of 100,000 Recreational Vehicle valued at 110,000. Car valued at 27,000 Medical bills totaling 8,700 Loan balance of 80,000. Savings of 5,000 Retirement fund of 50,000 Credit card balance of 2,300 a. recreational vehicle value decreasing to 100,000 b. borrowing 10,000 more in loans c. withdrawing 20,000 from the retirement fund d. adding 1,000 in credit card debt Please select the best answer from the choices provided A B D

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Answer

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VincentMaster · Tutor for 5 years

Answer

D

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Assets:- Recreational Vehicle: \(\$ 110,000\)- Car: \(\$ 27,000\)- Savings: \(\$ 5,000\)- Retirement fund: \(\$ 50,000\)Total Assets = \(\$ 110,000 + \$ 27,000 + \$ 5,000 + \$ 50,000 = \$ 192,000\)Liabilities:- Medical bills: \(\$ 8,700\)- Loan balance: \(\$ 80,000\)- Credit card balance: \(\$ 2,300\)Total Liabilities = \(\$ 8,700 + \$ 80,000 + \$ 2,300 = \$ 91,000\)Net Worth = Total Assets - Total Liabilities = \(\$ 192,000 - \$ 91,000 = \$ 101,000\)The current net worth is \(\$ 101,000\). We need to find out which modification will result in a net worth of \(\$ 100,000\).Let's evaluate each option:a. Recreational vehicle value decreasing to \(\$ 100,000\):This would reduce the total assets by \(\$ 10,000\), making the new net worth \(\$ 101,000 - \$ 10,000 = \$ 91,000\), which is not the target net worth.b. Borrowing \(\$ 10,000\) more in loans:This would increase the total liabilities by \(\$ 10,000\), making the new net worth \(\$ 101,000 - \$ 10,000 = \$ 91,000\), which is not the target net worth.c. Withdrawing \(\$ 20,000\) from the retirement fund:This would reduce the total assets by \(\$ 20,000\), making the new net worth \(\$ 101,000 - \$ 20,000 = \$ 81,000\), which is not the target net worth.d. Adding \(\$ 1,000\) in credit card debt:This would increase the total liabilities by \(\$ 1,000\), making the new net worth \(\$ 101,000 - \$ 1,000 = \$ 100,000\), which is the target net worth.
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