Write: Make sure your response addressing the following question is more than 200 words, and you include an in-text citation or a brief quote from the reading material where appropriate. Refer to the guide APA: Citing Within Your Paper.
Develop a balance sheet based on your personal financial condition:
Use actual accounts, such as house, mortgage, accounts payable, etc.
Do not use actual amounts but invent numbers.
Use the layout as described in the chapter, see page 1–20.
Post your balance sheet to the discussion area and tell us what, if anything, surprised you. Also, indicate how you would like this to look ten years from now.
Getting started…
Class, welcome to our second discussion forum for the week! In your reading this week, you learn about the financial accounting framework, financial statements, and transaction analysis.
In this discussion, we get to apply some of those same concepts to our personal finances which should be a lot of fun!
Below are some key points to keep in mind when preparing your pretend personal balance sheet:
Total Assets must equal Total Liabilities plus Total Equity
When it comes to personal balance sheets, we often balance the accounting equation as follows:
Total Assets MINUS Total Liabilities EQUALS Net worth (also known as equity).
I’ll provide a simple example to get you started:
Assets
Liabilities & Equity
Assets:
Liabilities:
Cash: $3,000
Utilities payable: $200
Investments: $10,000
Credit card payable: $500
Retirement accounts: $25,000
Car loan payable: $8,000
Personal property: $1,500
Mortgage payable: $127,000
Car: $10,000
Student loan payable: $7,500
House: $140,000
Total Liabilities: $143,200
Total Assets: $189,500
Equity (Net worth): $46,300
Total Liabilities & Equity: $189,500
This is just an example, of course, but it should give you an idea of what you might want to place on your pretend balance sheet.
Then, once you’ve prepared your hypothetical balance sheet, you want to interpret it and look for opportunities to improve the financial position in the future.
Have fun with this!! 😊
Also, be sure to check out my lectures for this week:
Introduction to Financial Accounting:
Debit & Credit Tutorial:
Also, I’m attaching a homework help file for Week 1. I will be providing these each week. In these files, I walk you through the processes to solve similar exercises to those assigned in MyLab (exercises with the same format but different numbers). Enjoy!
https://uagc.instructure.com/users/5597/files/21884971?wrap=1&verifier=sIG03NppbDrN34agATEHHr1P4I6t5t3DSp52gXC6
