For Mike Szabo, the changes in net worth for the year ended December 31, 2010, follow:
Realized increases in net worth:
Salary ..................$ 60,000
Dividend income .............................2,500
Interest income .................2,000
Gain on sale of marketable securities ..........500
Realized decreases in net worth:
Income taxes ...............................20,000
Interest expense ................6,000
Personal expenditures ..............29,000
Unrealized increases in net worth:
Stock options ................................3,000
Land ......................7,000
Residence ....................5,000
Unrealized decreases in net worth:
Boat ...................................3,000
Jewelry ......................1,000
Furnishings .................................4,000
Estimated income taxes on the differences between the
estimated current values of assets and the estimated
current amounts of liabilities and their tax bases ....15,000
Net worth at the beginning of year ........150,000
Required
a. Prepare a statement of changes in net worth for the year ended December 31, 2010.
b. Comment on the statement of changes in net worth.