Let's break down the details in Brenda's balance sheet from the information given:
Assets:
- Jewelry
- Food
- Wages
- Commission
- Bank account
- Tips
Liabilities:
- Health insurance
- Rent
Now, let's examine each statement to determine whether Brenda is correct:
1. Brenda is correct because she has five assets and only three liabilities.
- This statement compares the count of assets and liabilities. Brenda does have more asset items (six) compared to liability items (two). However, the sheer number of items does not determine their values. We cannot conclude that assets are greater just because there are more of them numerically.
2. Brenda is correct because all the items should be in the assets column of the balance sheet.
- This statement suggests that there might be a misclassification of items between assets and liabilities. However, each item accurately fits into either assets or liabilities based on their characteristics. Health insurance and rent are correctly classified as liabilities, not assets.
3. Brenda is not correct because the total value of her assets could be less than the liabilities.
- This statement addresses the potential value of items rather than their count. Even though Brenda has more assets by count, it is possible that the total monetary value of all assets could still be less than the total value of all liabilities. Without specific values, the comparison based on count is insufficient, making this a valid reason.
4. Brenda is not correct because she needs to list more liabilities.
- This statement implies that there should be more liabilities listed. Whether more liabilities exist isn't clear from the balance sheet alone. This does not inherently disprove Brenda's statement about the total value of her assets being greater.
Based on the analysis:
- The third statement accurately captures that simple counts do not reflect the potential financial reality. The values of assets and liabilities are what ultimately matter, and without knowing these values, Brenda cannot definitively claim her assets are greater than her liabilities.
Therefore, the correct explanation is:
Brenda is not correct because the total value of her assets could be less than the liabilities.
