4. Balance sheet - Net worth and interpreting the data The following is a partial balance sheet for Andy and Kim Garza. Complete the balance sheet by determining their total assets, total current liabilities, long-term liabilities, and net worth. Liabilities and Net Worth Current Liabilities Balance Sheet Name(s): Andy and Kim Garza Date: December 31, 2012 Assets Liquid Assets Cash $195.75 Checking Savings Total Liquid Assets: Electric $481.80 215.33 Water 206.49 244.69 Insurance premiums 344.15 1,125,00 $655.77 Taxes 833.33 Mortgage Auto Mastercard Investments Retirement funds LRA 1,032.46 $1.440.00 894.28 Total Investments 31.440.00 54.917 990 Total Current Liabilities: Real Property Primary residence $162,000.00 $39,999.84 Long-Term Liabilities Primary residence mortgage Total Long-Term Liabilities: $162,000.00 Total Real Property: Personal Property Honda Pilot Total Personal Property $11.990.00 $11.990.00 (2) Total Liabilities: Net Worth (1)-(2): (1) Total Assets: Total Liabilities and Net Worth: Based on the completed balance sheet, the Garzas net worth is 5 It isn't just the preparation of a balance sheet but the interpretation of the data that can reveal a family's financial condition. Andy and Kim Garza are both age 44. Using data from the 2012 Federal Reserve Bulletin (shown) and the Garzas' balance sheet, what coriclusions can you draw? $260,000 $240,000 $220,000 - $216,800 $206,700 $200,000 $180,000 $179,400 $160,000 $140,000 Median Net Worth $120,000 $117.900 $100,000 $80,000 - $60,000 $42,100 $40,000 $20,000 $9,300 30 Less than 35 35-44 45-54 55-64 65-74 75 or more Age Sourcet Jessie Bricker et al. "Changes in U.S. Family Finances from 2007 to 2010: Evidence from the Survey of Consumer Finances Federal Reserve Bulletin 98. no. 2 (June 201217. http//www.federalreserve.gov/pubs/Bulletin/2012/articles/id/act.htm. with their balance sheet in place, Andy and Kim can compare their total liabilities to their total assets to generate a more realistic view of their current wealth position. The Federal Reserve Bulletin provides data on median net worth, broken down by age brackets. Based on the Federal Reserve Bulletin data, the Garzas are the median net worth for their age group. Their would be considered their dominant asset, Based on their abilities, it appear that they have adequate liquid assets to meet their bill payments and to cover any small unexpected expenses Their balance sheet lists their house at 8% higher than the purchase price. The equity in their home is 5