Given the following personal balance sheet and personal income statement:

$3,522 Emergency Fund
$8,317 Total Liquid Assets
$40,000 Total Household Assets
$8,947 Superannuation (Restricted Assets)
[$8,947+10,000] Total Investment Assets (including superannuation)
$5,824 Total Current Liabilities
$47,969 Total Long-Term Liabilities
$73,416 Disposable Income
$56,636 Total Expenses

Calculate the Total Liabilities.

Note: Total Investment Assets (including superannuation) could be written in brackets. For example, Total Investment Assets (including superannuation) is [5,000+10,000], which is 15,000.

Question

Given the following personal balance sheet and personal income statement:

$3,522	Emergency Fund
$8,317	Total Liquid Assets
$40,000	Total Household Assets
$8,947	Superannuation (Restricted Assets)
[$8,947+10,000]	Total Investment Assets (including superannuation)
$5,824	Total Current Liabilities
$47,969	Total Long-Term Liabilities
$73,416	Disposable Income
$56,636	Total Expenses

Calculate the Total Liabilities.

Note: Total Investment Assets (including superannuation) could be written in brackets. For example, Total Investment Assets (including superannuation) is [5,000+10,000], which is 15,000.

BlackTom AI · Accepted Answer

Liabilities consist of current obligations plus long-term obligations, so add Total Current Liabilities and Total Long‑Term Liabilities: 5,824 + 47,969.

1. Relevant knowledge points and concepts
- Liabilities are debts or obligations and are classified into current (short‑term) and long‑term categories.
- Total Liabilities on a personal balance sheet = Total Current Liabilities + Total Long‑Term Liabilities.
- Assets (liquid, household, investment, superannuation) and income/expenses are separate and do not directly change the arithmetic for Total Liabilities.

2. Step‑by‑step reasoning
- Identify the two liability line items provided: Total Current Liabilities = 5,824 and Total Long‑Term Liabilities = 47,969.
- Sum these two numbers to obtain Total Liabilities.

3. Calculations (all intermediate steps)
- Start with the long‑term liabilities: 47,969
- Add the current liabilities in parts:
  - 47,969 + 5,000 = 52,969
  - 52,969 + 800 = 53,769
  - 53,769 + 24 = 53,793
- Final sum: 5,824 + 47,969 = 53,793

4. Why this answer is correct
- By definition, Total Liabilities equals the sum of current and long‑term liabilities. No other items (emergency fund, assets, disposable income, expenses) are liabilities, so they are excluded from this sum. The arithmetic above shows the exact total.

5. Why other potential mistakes are incorrect
- Treating assets (liquid, household, investment, superannuation) as liabilities would be wrong because assets represent resources, not obligations.
- Using disposable income minus expenses (73,416 − 56,636) would give surplus cash flow, not total liabilities.
- Omitting either current or long‑term liabilities would understate total liabilities.

6. Conclusion
Total Liabilities = 5,824 + 47,969 = 53,793, which matches the provided answer.

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