Question

When Angela calculated her net worth; she got this: Net Worth = $435 - $560 = - $125. What does her negative net worth mean?

A. Her liabilities are larger than her assets.


B. Her assets are larger than her liabilities.


C. Her assets and liabilities are the same.

EDIT: The answer is C. Thanks for nothing.

Answer 1

The negative net worth mean her liabilities are larger than her assets.

Explanation:

• Angela's calculation of net worth:

Net Worth = $435 - $560 = - $125

• Net worth is the difference in assets and debt. If the net worth is negative it means that debt is greater than assets.
• The same thing is in Angela's case. Her debt or liability is greater than total assets hence making her net worth negative.
• Her liability is still $125 greater than all of her assets added upon.