Question 1

Which one of the following illustrates an insolvent situation?

Accepted Answer

A) Assets $56,000; annual expenses $60,000 
B) Assets $78,000; net worth $22,000 
C) Liabilities $45,000; net worth $6,000 
D) Assets $40,000; liabilities $60,000 
E) Annual cash inflows $45,000; liabilities $50,000 
A) Assets $56,000; annual expenses $60,000 
B) Assets $78,000; net worth $22,000 
C) Liabilities $45,000; net worth $6,000 
D) Assets $40,000; liabilities $60,000 
E) Annual cash inflows $45,000; liabilities $50,000

Question 2

Liabilities are amounts representing:

Accepted Answer

A) debts owed now. 
B) items of value. 
C) living expenses. 
D) taxable income. 
E) current assets. 
A) debts owed now. 
B) items of value. 
C) living expenses. 
D) taxable income. 
E) current assets.

Question 3

Which of the following can be minimized through budgeting?

Accepted Answer

A) Overusing credit 
B) Lacking a regular savings program 
C) Failing to ensure future financial security 
D) All of these 
E) None of these 
A) Overusing credit 
B) Lacking a regular savings program 
C) Failing to ensure future financial security 
D) All of these 
E) None of these

Question 4

Which category of a home file includes stock and bond purchase documents?

Accepted Answer

A) Investment records 
B) Insurance records 
C) Estate planning records 
D) Tax records 
E) Consumer purchase records 
A) Investment records 
B) Insurance records 
C) Estate planning records 
D) Tax records 
E) Consumer purchase records

Question 5

Jonathan Winters has developed a budget that he follows each month.Jonathan has an envelope for each type of expenditure.After he cashes his paycheck,he puts the amount of cash in each envelope that he plans to spend on that category each month.What type of budget has Jonathan created?

Accepted Answer

A) Mental budget 
B) Physical budget 
C) Written budget 
D) Computerized budget 
E) Cloud budget 
A) Mental budget 
B) Physical budget 
C) Written budget 
D) Computerized budget 
E) Cloud budget

Question 6

Changes in the cost of living:

Accepted Answer

A) vary depending on where you live. 
B) are the same for different locations. 
C) are constant from month to month. 
D) are the same for all goods and services. 
E) are not a factor when preparing a budget. 
A) vary depending on where you live. 
B) are the same for different locations. 
C) are constant from month to month. 
D) are the same for all goods and services. 
E) are not a factor when preparing a budget.

Question 7

Furniture,jewelry,and an automobile are examples of liquid assets.

Accepted Answer

A) True 
 B)False

Question 8

When preparing her monthly budget,Maria Kent has projected income of $3,700.Each month she pays $1,200 in rent,$42 for life insurance,and $240 for her auto loan.What percentage of her budget goes for these fixed expenses?

Accepted Answer

A) 6 percent 
B) 12 percent 
C) 27 percent 
D) 40 percent 
E) 60 percent 
A) 6 percent 
B) 12 percent 
C) 27 percent 
D) 40 percent 
E) 60 percent

Question 9

Jamie McFarland has determined that the value of her liquid assets is $5,400,the value of her real estate is $182,000,the value of her personal possessions is $26,000,and the value of her investment assets is $73,000.She has also determined the value of her current liabilities is $7,500 and the value of her long-term liabilities is $98,000.What is the total value of her assets?

Accepted Answer

A) $286,400 
B) $182,000 
C) $73,000 
D) $26,000 
E) $7,500 
A) $286,400 
B) $182,000 
C) $73,000 
D) $26,000 
E) $7,500

Question 10

A family has a net worth of $165,000 and liabilities of $176,000,what is the amount of their assets?

Accepted Answer

A) $11,000 
B) $165,000 
C) $176,000 
D) $341,000 
E) $506,000 
A) $11,000 
B) $165,000 
C) $176,000 
D) $341,000 
E) $506,000

Question 11

During the past month,Jennifer Johnson had income of $3,500.During the month,her net worth declined by $300.If no other financial activities occurred,this means Jennifer's payments for the month were:

Accepted Answer

A) $3,800. 
B) $3,500. 
C) $3,200. 
D) $300. 
E) $0. 
A) $3,800. 
B) $3,500. 
C) $3,200. 
D) $300. 
E) $0.

Question 12

Discretionary income is money left over after paying for housing,food,and other necessities.

Accepted Answer

A) True 
 B)False

Question 13

The value of items owned minus the amounts owed to others equals:

Accepted Answer

A) net assets. 
B) net worth. 
C) total liabilities. 
D) total income. 
E) budgeted expenses. 
A) net assets. 
B) net worth. 
C) total liabilities. 
D) total income. 
E) budgeted expenses.

Question 14

Characteristics of successful budgets include being:

Accepted Answer

A) well planned. 
B) realistic. 
C) flexible. 
D) clearly communicated. 
E) All of these 
A) well planned. 
B) realistic. 
C) flexible. 
D) clearly communicated. 
E) All of these

Question 15

Explain why opportunity cost is an important concept in money management.

Accepted Answer

Opportunity costs are the trade-offs tha

Question 16

Jeremy Allison needs to store the title to his car and his military papers.Where is the most appropriate place for Jerry to store this information?

Accepted Answer

A) Home file 
B) Safe deposit box 
C) Personal computer 
D) Best friend's house 
E) No storage needed 
A) Home file 
B) Safe deposit box 
C) Personal computer 
D) Best friend's house 
E) No storage needed

Question 17

Common long-term liabilities include:

Accepted Answer

A) Auto loans 
B) Medical bills 
C) Insurance premiums 
D) Charge accounts 
E) Cash loans 
A) Auto loans 
B) Medical bills 
C) Insurance premiums 
D) Charge accounts 
E) Cash loans

Question 18

Amy Farmer has developed a budget that she follows each month.She went to the office supply store and purchased a spiral notebook.Each month she writes in what she plans to spend in the various categories.At the end of the month,she writes in the amount that she actually spent in each of these categories and compares this with the budgeted amounts.What type of budget has Amy created?

Accepted Answer

A) Mental budget 
B) Physical budget 
C) Written budget 
D) Computerized budget 
E) None of these 
A) Mental budget 
B) Physical budget 
C) Written budget 
D) Computerized budget 
E) None of these

Question 19

Discretionary income is:

Accepted Answer

A) a person's earnings after deducting taxes and other items. 
B) referred to as net pay. 
C) referred to as disposable income. 
D) money left over after paying for housing,food,and other necessities. 
E) referred to as take-home pay. 
A) a person's earnings after deducting taxes and other items. 
B) referred to as net pay. 
C) referred to as disposable income. 
D) money left over after paying for housing,food,and other necessities. 
E) referred to as take-home pay.

Question 20

Which one of the following presents a summary of cash receipts and payments for a period of time?

Accepted Answer

A) Balance sheet 
B) Credit card statement 
C) Investment summary 
D) Cash flow statement 
E) Asset report 
A) Balance sheet 
B) Credit card statement 
C) Investment summary 
D) Cash flow statement 
E) Asset report

Which one of the following illustrates an insolvent situation?

Liabilities are amounts representing:

Which of the following can be minimized through budgeting?

Which category of a home file includes stock and bond purchase documents?

Jonathan Winters has developed a budget that he follows each month.Jonathan has an envelope for each type of expenditure.After he cashes his paycheck,he puts the amount of cash in each envelope that he plans to spend on that category each month.What type of budget has Jonathan created?

Changes in the cost of living:

Furniture,jewelry,and an automobile are examples of liquid assets.

When preparing her monthly budget,Maria Kent has projected income of $3,700.Each month she pays $1,200 in rent,$42 for life insurance,and $240 for her auto loan.What percentage of her budget goes for these fixed expenses?

A family has a net worth of $165,000 and liabilities of $176,000,what is the amount of their assets?

During the past month,Jennifer Johnson had income of $3,500.During the month,her net worth declined by $300.If no other financial activities occurred,this means Jennifer's payments for the month were:

Discretionary income is money left over after paying for housing,food,and other necessities.

The value of items owned minus the amounts owed to others equals:

Characteristics of successful budgets include being:

Explain why opportunity cost is an important concept in money management.

Jeremy Allison needs to store the title to his car and his military papers.Where is the most appropriate place for Jerry to store this information?

Common long-term liabilities include:

Discretionary income is:

Which one of the following presents a summary of cash receipts and payments for a period of time?

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Choosing a Source of Credit: the Costs of Credit Alternatives

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health,disability,and Long-Term Care Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters

Exam 3: Money Management Strategy: Financial Statements and Budgeting

Which one of the following illustrates an insolvent situation?

Liabilities are amounts representing:

Which of the following can be minimized through budgeting?

Which category of a home file includes stock and bond purchase documents?

Jonathan Winters has developed a budget that he follows each month.Jonathan has an envelope for each type of expenditure.After he cashes his paycheck,he puts the amount of cash in each envelope that he plans to spend on that category each month.What type of budget has Jonathan created?

Changes in the cost of living:

Furniture,jewelry,and an automobile are examples of liquid assets.

When preparing her monthly budget,Maria Kent has projected income of $3,700.Each month she pays $1,200 in rent,$42 for life insurance,and $240 for her auto loan.What percentage of her budget goes for these fixed expenses?

A family has a net worth of $165,000 and liabilities of $176,000,what is the amount of their assets?

During the past month,Jennifer Johnson had income of $3,500.During the month,her net worth declined by $300.If no other financial activities occurred,this means Jennifer's payments for the month were:

Discretionary income is money left over after paying for housing,food,and other necessities.

The value of items owned minus the amounts owed to others equals:

Characteristics of successful budgets include being:

Explain why opportunity cost is an important concept in money management.

Jeremy Allison needs to store the title to his car and his military papers.Where is the most appropriate place for Jerry to store this information?

Common long-term liabilities include:

Discretionary income is:

Which one of the following presents a summary of cash receipts and payments for a period of time?

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Choosing a Source of Credit: the Costs of Credit Alternatives

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health,disability,and Long-Term Care Insurance

Life Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters