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How to calculate Net worth

The Net worth formula, with plain worked examples you can check yourself.

Net worth = A − L

Worked examples

A = 5000 · L = 2000Net worth = 3,000
A = 14000 · L = 10000Net worth = 4,000
A = 14000 · L = 11000Net worth = 3,000

How to use it

  1. Write down the values for each letter in the formula.
  2. Do the brackets first, then divide or multiply.
  3. Check the units before you compare results.
  4. Compare the answer with last period or with a competitor to see if it is good or bad.

This formula belongs to Cash & Liquidity.

Related terms

Cash flowLiquidityWorking capitalOverdraft

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