Net Worth can be defined as:

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BlackTom AI · Accepted Answer

The question asks: Net Worth can be defined as:

Option a. Net Income: This is the profit earned over a period (revenues minus expenses). It does not represent the overall stock of value at a point in time, which is what net worth measures, so this is not correct.

Option b. Wealth: Net worth is indeed the accumulated value of assets minus liabilities at a given moment, which aligns with the common understanding of wealth as net worth.

Option c. Liabilities: Liabilities are the debts or obligations a person or entity owes. They are part of the calculation of net worth (in the sense that liabilities subtract from assets), but they alone do not define net worth; they are a component.

Option d. Sales Revenue: This is the total income from selling goods or services before any costs are subtracted. It does not reflect the net stock of assets minus liabilities, so it is not the definition of net worth.

Therefore, among the options, Wealth best matches the definition of net worth, since net worth = total assets − total liabilities, which equates to overall wealth.

252_2HO004_Accounting II

Net Worth can be defined as:

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Similar Questions

Your financial net worth is a comparison of what you own to what you owe – just like a business balance sheet.

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Net Worth can be defined as:

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