Question 1

A cash budget helps you:

Accepted Answer

A)  monitor and control your finances. 
B)  analyze your financial position. 
C)  calculate your solvency ratio. 
D)  measure your net worth. 
E)  identify your long-term debt. 
A)  monitor and control your finances. 
B)  analyze your financial position. 
C)  calculate your solvency ratio. 
D)  measure your net worth. 
E)  identify your long-term debt.

Question 2

An individual can maintain his or her personal financial statements using spreadsheet software.

Accepted Answer

A) True 
 B)False

Question 3

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(n) [ auto loan balance  | insurance premium ] would be an example of a current liability.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 4

In a budget, "fun money" is for family members to spend as they like.

Accepted Answer

A) True 
 B)False

Question 5

The total amount of salary you earn before taxes are deducted is your _____ salary .

Accepted Answer

A)  gross 
B)  after-tax 
C)  take-home 
D)  net 
E)  liquid 
A)  gross 
B)  after-tax 
C)  take-home 
D)  net 
E)  liquid

Question 6

_____ is an example of personal property.

Accepted Answer

A)  Jewelry 
B)  A mutual fund 
C)  A corporate bond 
D)  A charge account 
E)  A certificate of deposit 
A)  Jewelry 
B)  A mutual fund 
C)  A corporate bond 
D)  A charge account 
E)  A certificate of deposit

Question 7

A budget is a financial report that forecasts an individual's current income as a percentage of his or her past earnings.

Accepted Answer

A) True 
 B)False

Question 8

Elena purchased a stamp collection for $5,000 30 years ago. If its value appreciated at 8% annually, what is it worth today? (Round the answer to the nearest dollar.)

Accepted Answer

A)  $17,000 
B)  $36,400 
C)  $50,313 
D)  $123,023 
E)  $150,000 
A)  $17,000 
B)  $36,400 
C)  $50,313 
D)  $123,023 
E)  $150,000

Question 9

A cash surplus on an income and expense statement prepared on a cash basis indicates that:

Accepted Answer

A)  the net worth is equal to zero. 
B)  investments are less than the cash balance. 
C)  the payments on debts are not met. 
D)  total expenses are less than total income . 
E)  income and expenses are equal. 
A)  the net worth is equal to zero. 
B)  investments are less than the cash balance. 
C)  the payments on debts are not met. 
D)  total expenses are less than total income . 
E)  income and expenses are equal.

Question 10

In which of the following ways is an income and expense statement and a cash budget alike?

Accepted Answer

A)  They are prepared on a cash basis. 
B)  They compare projected income to projected expenses. 
C)  They show an individual's net worth. 
D)  They describe an individual's financial position at a given point in time. 
E)  They are used as the basis for computing solvency and liquidity ratios. 
A)  They are prepared on a cash basis. 
B)  They compare projected income to projected expenses. 
C)  They show an individual's net worth. 
D)  They describe an individual's financial position at a given point in time. 
E)  They are used as the basis for computing solvency and liquidity ratios.

Question 11

If your statement of income and expense prepared on a cash basis shows a deficit, you have:

Accepted Answer

A)  increased your debts. 
B)  liquidated your investments. 
C)  increased your savings. 
D)  taken a cash loan on your insurance. 
E)  sold some securities. 
A)  increased your debts. 
B)  liquidated your investments. 
C)  increased your savings. 
D)  taken a cash loan on your insurance. 
E)  sold some securities.

Question 12

Which of the following statements regarding budgets is true?

Accepted Answer

A)  Budgets are detailed forward-looking financial reports based on expected income and expenses. 
B)  Budgets describe a person's financial position at a given point in time. 
C)  Budgets measure a person's financial performance at a given point in time. 
D)  Budgets describe a person's financial goals over time. 
E)  Budgets are historical documents that tell an individual how he or she has performed in the past. 
A)  Budgets are detailed forward-looking financial reports based on expected income and expenses. 
B)  Budgets describe a person's financial position at a given point in time. 
C)  Budgets measure a person's financial performance at a given point in time. 
D)  Budgets describe a person's financial goals over time. 
E)  Budgets are historical documents that tell an individual how he or she has performed in the past.

Question 13

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. 
The balance sheet and income and expense statement provide a picture of your [ actual | projected ] financial position.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 14

Which of the following statements regarding a budget is true?

Accepted Answer

A)  It shows the computation of the interest on a loan. 
B)  It is a schedule of personal investments. 
C)  It is a list of prepaid expenses. 
D)  It is a detailed financial report that looks forward. 
E)  It identifies your assets and liabilities. 
A)  It shows the computation of the interest on a loan. 
B)  It is a schedule of personal investments. 
C)  It is a list of prepaid expenses. 
D)  It is a detailed financial report that looks forward. 
E)  It identifies your assets and liabilities.

Question 15

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. 
The purpose of the debt service ratio is to show the amount of income needed to pay your [ current liabilities | monthly loan payments ].

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 16

A _____  is an example of a tangible asset.

Accepted Answer

A)  house 
B)  patent 
C)  copyright 
D)  trademark 
E)  mortgage 
A)  house 
B)  patent 
C)  copyright 
D)  trademark 
E)  mortgage

Question 17

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

Accepted Answer

In the financial calculator, i

Question 18

The three parts of an individual's balance sheet are his or her:

Accepted Answer

A)  income, liabilities, and net worth. 
B)  assets, expenditures, and net worth. 
C)  assets, liabilities, and expenses. 
D)  assets, liabilities, and net worth. 
E)  income, liabilities, and assets. 
A)  income, liabilities, and net worth. 
B)  assets, expenditures, and net worth. 
C)  assets, liabilities, and expenses. 
D)  assets, liabilities, and net worth. 
E)  income, liabilities, and assets.

Question 19

The preparation of an income and expense statement is the first step in the personal financial planning process.

Accepted Answer

A) True 
 B)False

Question 20

The best way to handle inflation in long-term financial planning decisions is first to consider the history of inflation.

Accepted Answer

A) True 
 B)False

A cash budget helps you:

An individual can maintain his or her personal financial statements using spreadsheet software.

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(n) [ auto loan balance | insurance premium ] would be an example of a current liability.

In a budget, "fun money" is for family members to spend as they like.

The total amount of salary you earn before taxes are deducted is your _____ salary .

_____ is an example of personal property.

A budget is a financial report that forecasts an individual's current income as a percentage of his or her past earnings.

Elena purchased a stamp collection for $5,000 30 years ago. If its value appreciated at 8% annually, what is it worth today? (Round the answer to the nearest dollar.)

A cash surplus on an income and expense statement prepared on a cash basis indicates that:

In which of the following ways is an income and expense statement and a cash budget alike?

If your statement of income and expense prepared on a cash basis shows a deficit, you have:

Which of the following statements regarding budgets is true?

Which of the following statements regarding a budget is true?

A _____ is an example of a tangible asset.

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

The three parts of an individual's balance sheet are his or her:

The preparation of an income and expense statement is the first step in the personal financial planning process.

The best way to handle inflation in long-term financial planning decisions is first to consider the history of inflation.

Understanding the Financial Planning Process

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds and Real Estate

Planning for Retirement

Preserving Your Estate

Filters

Exam 2: Developing Your Financial Statements and Plans

A cash budget helps you:

An individual can maintain his or her personal financial statements using spreadsheet software.

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(n) [ auto loan balance | insurance premium ] would be an example of a current liability.

In a budget, "fun money" is for family members to spend as they like.

The total amount of salary you earn before taxes are deducted is your _____ salary .

_____ is an example of personal property.

A budget is a financial report that forecasts an individual's current income as a percentage of his or her past earnings.

Elena purchased a stamp collection for $5,000 30 years ago. If its value appreciated at 8% annually, what is it worth today? (Round the answer to the nearest dollar.)

A cash surplus on an income and expense statement prepared on a cash basis indicates that:

In which of the following ways is an income and expense statement and a cash budget alike?

If your statement of income and expense prepared on a cash basis shows a deficit, you have:

Which of the following statements regarding budgets is true?

Which of the following statements regarding a budget is true?

A _____ is an example of a tangible asset.

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

The three parts of an individual's balance sheet are his or her:

The preparation of an income and expense statement is the first step in the personal financial planning process.

The best way to handle inflation in long-term financial planning decisions is first to consider the history of inflation.

Understanding the Financial Planning Process

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds and Real Estate

Planning for Retirement

Preserving Your Estate

Filters