Question 1

Jennifer has assets of $100,000 and $10,000 of debt.She could

Accepted Answer

A) borrow more money,since her debt ratio is low. 
B) apply for a bank loan,but expect to be turned down. 
C) borrow approximately $200,000 at below market rates. 
D) not borrow more money until she paid off her current debt.

Question 2

Cash inflows tend to be the highest in which of the following?

Accepted Answer

A) College 
B) Retirement 
C) 20 years into a career 
D) First job out of college

Question 3

Creating a cash flow statement requires that you determine

Accepted Answer

A) assets. 
B) liabilities. 
C) cash used for expenses. 
D) market value of investments.

Question 4

A(n)________ is a forecast of your future cash inflows and outflows.

Accepted Answer

The answer of A(n)________ is a forecast of your future...

Question 5

One of the problems in making a monthly budget is that some expenses fluctuate quite a bit from month to month.

Accepted Answer

A) True 
 B)False

Question 6

All of the following affect cash outflows except

Accepted Answer

A) the size of the family. 
B) your age. 
C) your education level. 
D) your personal consumption behavior.

Question 7

Which one of the following is a liquid asset?

Accepted Answer

A) Cash in a savings account 
B) A swimming pool 
C) Real estate 
D) Stock held in an IRA

Question 8

A three-month budget is easier to prepare,anticipates large and unusual expenditures,and gives a better picture than a twelve-month budget.

Accepted Answer

A) True 
 B)False

Question 9

David's liquidity ratio is 3.0.He has $1,000 in current liabilities.Therefore,he has ________ worth of liquid assets.
(a)$3,000
(b)$333
(c)$4,000
(d)$700

Accepted Answer

The answer of David's liquidity ratio is 3.0.He has $1,000...

Question 10

Individuals who switch from a low-demand industry to a high-demand industry usually earn higher incomes.

Accepted Answer

A) True 
 B)False

Question 11

List three components of your personal balance sheet and two components of your income statement.

Accepted Answer

The answer of List three components of your personal balance...

Question 12

Balance sheet assets should be valued at

Accepted Answer

A) original purchase price. 
B) replacement value. 
C) insured value. 
D) fair market value.

Question 13

If your net cash inflows exceed your net cash outflows,you can increase your net worth by investing the difference in more ________.

Accepted Answer

The answer of If your net cash inflows exceed your...

Question 14

If your current debt to asset ratio is 50%,which of the following will increase it?

Accepted Answer

A) Taking out a home equity loan 
B) Buying a car with cash 
C) Paying off a student loan 
D) Buying stock with cash

Question 15

Jerry has assets of $200,000,a net worth of $150,000,and an annual income of $100,000.What are Jerry's liabilities?
(a)$100,000
(b)$250,000
(c)$50,000
(d)$450,000

Accepted Answer

The answer of Jerry has assets of $200,000,a net worth...

Question 16

Jim has $1,000 income from his job and $200 stock dividend income this month.This month Jim has rent and utilities of $300 and he spent $300 on groceries and $200 on clothing.What is his cash inflow this month?

Accepted Answer

A) $1,200 
B) $400 
C) $600 
D) $500

Question 17

Salary or wages are the only cash inflows for working people.

Accepted Answer

A) True 
 B)False

Question 18

The personal cash flow statement measures

Accepted Answer

A) the rate of cash flow. 
B) cash outflows only. 
C) cash inflows and outflows. 
D) cash inflows only.

Question 19

The cash in your wallet,your checking account balance,and your savings account comprise your ________ assets.

Accepted Answer

The answer of The cash in your wallet,your checking account...

Question 20

Detecting future cash flow overages and deficiencies in cash inflows and outflows improves with practice in the budgeting process.

Accepted Answer

A) True 
 B)False

Exam 2: Planning With Personal Financial Statements

Jennifer has assets of $100,000 and $10,000 of debt.She could

Cash inflows tend to be the highest in which of the following?

Creating a cash flow statement requires that you determine

A(n)________ is a forecast of your future cash inflows and outflows.

One of the problems in making a monthly budget is that some expenses fluctuate quite a bit from month to month.

All of the following affect cash outflows except

Which one of the following is a liquid asset?

A three-month budget is easier to prepare,anticipates large and unusual expenditures,and gives a better picture than a twelve-month budget.

David's liquidity ratio is 3.0.He has $1,000 in current liabilities.Therefore,he has ________ worth of liquid assets. (a)$3,000 (b)$333 (c)$4,000 (d)$700

Individuals who switch from a low-demand industry to a high-demand industry usually earn higher incomes.

List three components of your personal balance sheet and two components of your income statement.

Balance sheet assets should be valued at

If your net cash inflows exceed your net cash outflows,you can increase your net worth by investing the difference in more ________.

If your current debt to asset ratio is 50%,which of the following will increase it?

Jerry has assets of $200,000,a net worth of $150,000,and an annual income of $100,000.What are Jerry's liabilities? (a)$100,000 (b)$250,000 (c)$50,000 (d)$450,000

Jim has $1,000 income from his job and $200 stock dividend income this month.This month Jim has rent and utilities of $300 and he spent $300 on groceries and $200 on clothing.What is his cash inflow this month?

Salary or wages are the only cash inflows for working people.

The personal cash flow statement measures

The cash in your wallet,your checking account balance,and your savings account comprise your ________ assets.

Detecting future cash flow overages and deficiencies in cash inflows and outflows improves with practice in the budgeting process.