Question: DEVELOPING CRITICAL-THINKING SKILLS
According to the experts, you must evaluate your existing financial condition before establishing an investment plan. As pointed out in this chapter, a personal balance sheet provides a picture of your assets, liabilities, and net worth. A personal income statement will tell you whether you have a cash surplus or cash deficit at the end of a specific time period.
Assignment: 1. Using your own financial information from last month, construct a personal balance sheet and personal income statement.
2. Based on the information contained in your personal financial statements, answer the following:
a. What is your current net worth?
b. Do you have a cash surplus or a cash deficit at the end of the month?
c. What specific steps can you take to improve your financial condition?
3. Based on your findings, prepare a plan for improving your financial condition over the next six months.