Question

Rosetta listed her assets and liabilities on a personal balance sheet.

Rosetta’s Balance Sheet (April 2013)
Assets
Liabilities
cash
$900
credit card
$4,000
investments
$1,100
student loan
$2,000
house
$150,000
mortgage
$100,000
car
$8,000
car loan
$5,000
Total

Total


If Rosetta sells her house and pays off the mortgage, how much should she receive (assuming there are no other costs associated with selling the house)?

Answer 1

She would receive $150,000 − $100,000 = $50,000 (net proceeds after paying off the mortgage).