The Johnson household has compiled the following financial information. They live in a house that has lost some of its market value due to zoning changes nearby; the best estimate for their house’s worth is $150,000. While the Johnsons still owe $160,000 on their mortgage, they make payments of $1,200 each month. Groceries cost the family approximately $1,000 per month. The Johnsons also have a car (valued at $9,000; with loan balance of $10,870; monthly payments of $297), an SUV (valued at $15,900; with loan balance of $20,560; monthly payments of $498), and a boat (valued at $500; with loan balance of $2,210; monthly payments of $153). They have roughly $5,000 of furniture that includes mattresses, a couch, beds, an entertainment center, and several other items (they still owe about $1,670 on these items). Mr. Johnson is an avid baseball fan and has a card collection worth $1,400. Their credit card debt totals $15,000 with monthly payments of $485. To fund their higher education, the Johnsons took out some student loans that total $37,850 with payments of $276 per month. Allegedly, they also have a treasure map valued at $699. On average, the Johnson’s checking account has $2,000, and their savings account has $3,700. Their combined retirement accounts have $21,009. Using the information above create their personal balance sheet in the space provided below.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The Johnson household has compiled the following financial information. They live in a house that has lost some of its market value due to zoning changes nearby; the best estimate for their house’s worth is $150,000. While the Johnsons still owe $160,000 on their mortgage, they make payments of $1,200 each month. Groceries cost the family approximately $1,000 per month. The Johnsons also have a car (valued at $9,000; with loan balance of $10,870; monthly payments of $297), an SUV (valued at $15,900; with loan balance of $20,560; monthly payments of $498), and a boat (valued at $500; with loan balance of $2,210; monthly payments of $153). They have roughly $5,000 of furniture that includes mattresses, a couch, beds, an entertainment center, and several other items (they still owe about $1,670 on these items). Mr. Johnson is an avid baseball fan and has a card collection worth $1,400. Their credit card debt totals $15,000 with monthly payments of $485. To fund their higher education, the Johnsons took out some student loans that total $37,850 with payments of $276 per month. Allegedly, they also have a treasure map valued at $699. On average, the Johnson’s checking account has $2,000, and their savings account has $3,700. Their combined retirement accounts have $21,009. Using the information above create their personal balance sheet in the space provided below.

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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