Which of the following situations is a person who could be insolvent?
A)Assets $56,000; annual expenses $60,000
B)Assets $68,000; net worth $22,000
C)Liabilities $45,000; net worth $6,000
D)Assets $60,000; liabilities $61,000
E)Annual cash inflows$48,000; liabilities $50,000

Question

Quizplus · Accepted Answer

Insolvency occurs when an individual's debt exceeds their assets or net worth. In this case, option D is the only scenario where liabilities ($61,000) exceed assets ($60,000), indicating insolvency.

Which of the Following Situations Is a Person Who Could