Exam 2: Measuring Your Financial Health and Making a Plan

Your ________ is found by dividing total debt or liabilities by total assets.

The current ratio is a measure of liquidity that reflects

According to the Keown book,Mint and Level Money are two of the best smartphone apps for tracking your spending and setting up a budget.

An income statement tracks the amount of money you have coming in and going out over some period of time,such as a month or a year.

Your net worth,or your general level of financial worth,is found by

Liabilities are best described as

Suppose that David's only assets are an automobile worth $10,000 and a checking account with a $5,000 balance.His only liabilities are a student loan balance of $12,000 and a balance of $9,000 on his car loan.What is his net worth?

An expenditure over which you have no control,are obligated to make,and is generally at a constant level each month is called a ________ expenditure.

George and Betty George and Betty, a middle-aged couple, have watched their savings account dwindle over the years. They both make good incomes and can't understand why they aren't saving more each month. Below is their financial information to complete an income statement. Gross monthly income: $8,000 Income taxes withheld monthly: $2,300 Monthly interest income from investments: $100 Monthly insurance payments: $700 Monthly housing expenses: $4,500 Monthly food expenses: $800 Miscellaneous expenses: $400 -George and Betty ask you for financial advice.What would you tell them to do?

Kareem has $6000 in monetary assets and $2000 in current liabilities.What is his current ratio?

A strong record-keeping system allows you to

If the people below,with their respective current ratios,were to lose their jobs today,which one would have more time and more choices until he or she found another job?

What questions do financial ratios help answer?

Which of the following is the best type of record-keeping system to use in maintaining financial records?

Hector and Maria Montez Hector and Maria Montez are trying to figure out their financial health. They will pay off their car loan in three years, their gross household income is $3,800 per month, and they receive $75 per month in interest income from their investments. They have listed the following items from their most recent statements. Savings account: $1,200 Checking account: $800 Credit card balance: $1,000 Car loan balance: $12,000 Car market value: $8,000 Furniture; market value: $2,000 Stocks and bonds: $10,000 -Assuming that they have no current bills other than those that are listed,what is their current ratio?

Which of the following might be found on an income statement?

To determine your net worth,subtract your liabilities from your positive net equity.

Tim and Autumn Davis Tim and Autumn Davis are trying to figure out their current financial health. They will pay off their car loan in three years, their gross household income is $5,700 per month, and they receive $95 per month in interest income from their investments. They have listed the following items from their most recent statements. Savings account: $3,200 Checking account: $1,800 Credit card balance: $3,000 Car loan balance: $18,000 Car market value: $15,000 Furniture market value: $4,000 Stocks and bonds: $15,000 -What is their current net worth?

Which financial planning document should you use to measure your current financial condition?

Explain the steps in developing a cash budget.