Exam 2: Your Financial Statements and Plans

Sonny and Cher have a net worth of $35,000 and total assets of $200,000.If their revolving credit and unpaid bills total $2,200,what are their long-term liabilities?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -[Medical expenses | Rent payments] would be more difficult to estimate for the coming year.

A family could have a positive savings ratio at the same time its debt service ratio is increasing.

When Phil lists his house on his balance sheet,he should record the

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -A [credit card bill | credit card balance] would be an example of a current liability.

Elena purchased a stamp collection for $5,000 thirty years ago.If it appreciated 8% annually,what is it worth today?

You would not include ____ on an income and expenditures statement.

The expenditure categories for your budget should be determined by

Theresa invested $5,000 in an account she expects will earn 7% annually.Approximately how many years will it take for the account to double in value?

Rosa and Jose have liquid assets of $5,000 and other assets of $50,000.Their total liabilities equal $26,000.What is their net worth? (Show all work. )

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -A [savings account | retirement account] would be an example of a liquid asset.

The most common budgeting period is a

A budget is an orderly estimate of income and expenditures.

The Flemings will need $80,000 annually for 20 years during retirement.How much will they need at retirement if they can earn a 4% rate of return?

For purposes of personal financial planning,assets appear on a balance sheet at fair market value,just as they would under Generally Accepted Accounting Principles (GAAP)on a business balance sheet.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -If your expenses exceed your income,the bottom line of your income/expense statement will show a [surplus | deficit].

The savings ratio is useful in the evaluation of the balance sheet.

The income statement includes information on your latest paycheck.

Michael and Sandy purchased a home for $100,000 five years ago.If it appreciated 6% annually,what is it worth today?

Budgets are