1.) What is the family's net worth? - provide balance sheet
Provided information:
They own their home which has an assessed value of $200,000 anda market value of about $300,000 (as determined by a real estateappraiser based on recent sales of comparable homes in similarneighborhoods.) The mortgage on the home has a balance of $140,000.A review of the Douglas' financial information, bank statements,and other documents shows the following as of 11/30/16:
2011 Camry worth about $11,000, with a bank loan balance of$3,000
2012 Volvo S60 worth about $15,000, with a bank loan balance of$10,000
An insurance policy on Jeff's life with a face value of $100,000and no cash surrender value. Mary is the beneficiary listed onJeff's policy.
An insurance policy on Mary's life with a face value of $10,000and no cash surrender value. Jeff is the beneficiary listed onMary's policy.
Credit card balances that total $3,500.
A savings account with a $1,000 balance.
Two mutual funds earmarked for the children's college education.The account for Paul has a balance of $10,000 and Marcy's has$11,000 as a current balance. The fund has averaged an 8% annualrate of return over its life.
100 shares of Apple Inc. (NASDAQ: stock symbol = AAPL), formerlyApple Computer, Inc. You need to value this stock based on the11/30/16 price per share. You will need to find that on theInternet.
200 Shares of AT&T (value as of 11/30/16)
150 shares of Twitter. (value as of 11/30/16)
A checking account with a balance of $3,000.
Jeff estimates that their furniture, fixtures etc. in the homeare worth about $7,000.
Jeff and Mary have retirement accounts that have a currentmarket value of approximately $200,000.
Mary still has an education loan with an outstanding balance of$15,000. It still have seven years left on it.
A vacation loan of $750 due in 6 months and a home improvementloan of $2,000 due in 2 years (unsecured - not a home equityloan.)
Jeff wants to finish the basement and he has discussed this atlength with Mary. He is getting estimates from contractors based onideas that both he and Mary have to create a play area for thechildren and a TV/den for the family. Jeff and Mary love to playping pong and pool and would love to introduce the children to both"sports." He believes that the project will cost about $30,000 andhe is interested in tapping into the home equity.
Jeff is also an avid baseball fan and is looking at buying amembership to a local baseball/softball facility for both Paul andMarcy. He figures that since he doesn't have any expensive hobbies,it would be fun to get Paul started as a baseball player and Marcyas a softball player. The membership costs and related costs are asfollows: $1,500 per year (covers both kids), equipment $500 peryear, and team registration and travel costs will be about another$1,000 to $2,000 a year depending on how serious the kids become.Mary is not sure that this is a priority at this point and wants toexplore this possibility in more detail.
