3 ms·
Why wouldn't the net worth be -$600k? Debt is usually accounted for in net worth.
by alpha_squared 9y ago
Why wouldn't the net worth be -$600k? Debt is usually accounted for in net worth.
- sndp 9y agoYou'd account for the debt, as well as the value of the property. Liabilites: $800k loan Assets: $1M property $0 cash Net worth: $200k
- IanCal 9y ago$1M assets - $800k debt = $200k net worth Assuming everything keeps its value equal and buying and selling have no cost (which at these scales and required accuracy is probably reasonable for the comment), any amount of buying and selling and borrowing should keep your net worth identical.