Exam 2: Measuring Your Financial Health and Making a Plan

According to the Keown book,the median net worth for American families in which the head of the household is less than 35 years old is below $10,000.

The common thread among investment assets is that

Using financial ratios helps you quickly compare and analyze the raw data found in your personal income statement and balance sheet.

According to the Keown book,an emergency fund consists of liquid assets that are sufficient to cover ________ of expenditures.

According to the Keown book,the most popular personal financial management program for the PC is

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 -Assuming that they have no current bills other than those that are listed,what is their current ratio?

An expenditure over which you have control and are not obligated to make,and which may vary from month to month is called a ________ expenditure.

What are some benefits of using a mobile app coupled with a Web-based personal financial planning website? Which two websites/apps are highly recommended by the author?

A plan for controlling and forecasting your cash inflows and cash outflows is called a(n)

A(n)________ is a reserve or rainy-day fund with money set aside to be used for unexpected expenses or when normal income has been disrupted.

List the benefits a professional financial planner can offer.

Planning and budgeting requires

Suppose that you wanted to calculate a financial ratio to measure your liquidity.You would most likely use the ________ ratio.

Patty has $9,000 in monetary assets,annual living expenses of $36,000,a $12,000 car loan balance,and $45,000 in equity in her house.What is her month's living expenses covered ratio?

The purpose of using financial ratios is to

In some cases insolvency can lead to bankruptcy.

Which type of expenditure would probably be the hardest for an individual to track?

Does your use of debt affect your net worth?

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 month's living expenses covered ratio?

Describe an income statement and its functions.