What does assets minus liabilities equal in financial terms?

In financial terms, assets minus liabilities results in net worth. This concept reflects the ownership value that an individual or entity has after all debts are accounted for. When you subtract what you owe (liabilities) from what you own (assets), you arrive at the net worth figure, which indicates how financially secure someone is.

This calculation is fundamental in personal finance and business accounting, as it can give insights into the financial health and solvency of an individual or organization. Understanding net worth helps in making informed financial decisions, assessing investment potential, and planning for the future.

Other options may represent different financial concepts, but they do not equate to the direct difference between assets and liabilities. For instance, gross income refers to total earnings before any deductions, equity can be related to ownership in assets, but is not a direct measure of net worth as it may involve only specific types of assets or interests. Revenue represents the income generated from sales or services and does not relate to net worth calculation.