Exam 2: Planning With Personal Financial Statements

Cash inflows tend to increase as a person gets older since they are further along in their careers.

Use the following two columns of items to answer the matching questions below: -liquid assets A)financial instruments representing partial ownership of a firm B)financial instruments issued by borrowers to raise funds C)investment companies that sell shares to individuals and invest the proceeds in stocks and bonds D)debt that will be paid within a year E)financial assets that can be easily sold without a loss F)rental property and land

Use the following two columns of items to answer the matching questions below: -current liabilities A)financial instruments representing partial ownership of a firm B)financial instruments issued by borrowers to raise funds C)investment companies that sell shares to individuals and invest the proceeds in stocks and bonds D)debt that will be paid within a year E)financial assets that can be easily sold without a loss F)rental property and land

Allison expects her monthly cash inflow after taxes to be $3,000. She also has the following monthly expenses: Rent, $750; student loan payment, $200; utilities, $150; food, $300; recreation, $600; car expenses, $200; clothing, $150. What is Allison's net cash flow for the current month?

The term "liquid assets" refers to

High income earners always have positive cash flow.

Investment assets include all of the following, except

Which of the following is not a cash outflow?

Use the following items to answer the matching questions below: -household assets

Use the following two columns of items to answer the matching questions below: -bonds A)financial instruments representing partial ownership of a firm B)financial instruments issued by borrowers to raise funds C)investment companies that sell shares to individuals and invest the proceeds in stocks and bonds D)debt that will be paid within a year E)financial assets that can be easily sold without a loss F)rental property and land

Use the following two columns of items to answer the matching questions below: -real estate

Debts that are to be paid off within a year are called

A high debt ratio indicates an excessive amount of debt and should be reduced over time to avoid any debt repayment problems.

A budget will not do which of the following?

If both a husband and wife are employed, their consumption will tend to

Detecting future cash flow shortages improves with practice in the budgeting process.

Lucky Louie just inherited $50,000 from his great aunt, has $1,500 in his checking account, owns a car with a value of $8,000, and has $20,000 in his 401(k) at work. Louie owes $6,000 on his car, $12,000 on school loans and $3,000 on his credit card. What is Louie's net worth?

Jerry has assets of $200,000, a net worth of $150,000, and an annual income of $100,000. What are Jerry's liabilities?

Margaret has $5,000 in her checking account, a home with a market value of $175,000, and stocks valued at $10,000. Margaret also has credit card debt of $15,000. Margaret's liquidity ratio is

An investment company that sell shares to individuals and then invests the proceeds in stocks or bonds is called a