Exam 2: Money Management Strategy: Financial Statements and Budgeting

Ben Chase needs to pay off some of his debts over the next few months. Which item on his balance sheet would help him decide what amounts are due in the near future?

Opportunity cost refers to:

Given the following, what is the individual's net worth? Bank account \ 2,500 Student loan \ 9,500 Monthly gross income \ 3,200 RRSP \ 10,250 Annual car payments \ 3,600 Unpaid vet bills \ 600 Jewellery \ 5,000 Car loan \ 1,900 CSV (whole life) \ 1,500 Car (resale value) \ 2,500 Annual medical expenses \ 500 GICs \ 2,060

During the last month, Mary Jane had expenses of $5,000 and an increase in net worth of $700. This means Mary Jane's income for the month was:

Leveraged investing in common shares is expected to increase your net worth.

Insolvency is the inability to pay debts by the due date, because liabilities exceed the value of assets.

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

If budgeted spending is less than actual spending, this is referred to as a deficit.

If a family planned to spend $370 for food during March but only spent $348, this difference would be referred to as a

This year Taylor's gross income is $70,000. Her deductions for federal and provincial taxes, CPP contributions and employment insurance are $13,500. She also had after-tax investment earnings of $6,000. Taylor's take-home pay is:

Which of the following payments would be considered a variable expense?

Payments that do not vary from month to month are ____________ expenses.

Warranties are commonly associated with ____________ purchases.

Which of the following financial documents would most likely be stored in a safety deposit box?

If expenses for a month are greater than income, an increase in net worth will result.