Chapter 2, Problem 2FPE

Summary Introduction

To prepare: The balance sheet of person EC for the year end June 30, 2017.

A personal balance sheet provides a snapshot of an individual’s wealth for a particular period of time. It shows the assets and liabilities and the net worth of an individual.

a)

Summary Introduction

To evaluate: The solvency ratio.

b)

Summary Introduction

To evaluate: The liquidity ratio.

c)

Summary Introduction

To evaluate: The equity in person EC’s dominant assets.