On September 30, Debbie and Tim started arguing about who is better off. Tim said he was better off because he owned a Wii console that he bought last year for $350. Debbie argued that she was better off because she had $1,000 cash and a '05 Mustang that she bought two years ago for $800. Tim countered that Debbie still owed $500 on her car and that his dad promised to buy him a Porsche worth $90,000 if he does well in his accounting class. Tim said he had $6,000 in his bank account right now because he just received a $4,800 student loan (immediate cash). Ashley knows that Tim still owes an installment of $800 on this term's tuition (not included in the student loan).
Show balance sheet calculations for Debbie or Tim. Calculate assets and liabilities for both Debbie and Tim, then calculate each person's equity...remembering that equity represents "residual value" or the difference between assets and liabilities.