Question 1

A(n)____ would not be listed as an asset on your balance sheet.

Accepted Answer

A)  mortgaged home 
B)  savings account 
C)  owned automobile 
D)  checking account 
E)  leased automobile 
A)  mortgaged home 
B)  savings account 
C)  owned automobile 
D)  checking account 
E)  leased automobile

Question 2

Jamil invested $9,500 in an account he expects will earn 5% annually.Approximately how many years will it take for the account to double in value?

Accepted Answer

A)  8.8 
B)  9.7 
C)  10.8 
D)  11.4 
E)  14.4 
A)  8.8 
B)  9.7 
C)  10.8 
D)  11.4 
E)  14.4

Question 3

A budget is an orderly estimate of income and expenditures.

Accepted Answer

A) True 
 B)False

Question 4

Only four categories of spending account for almost 90% of all consumer spending.

Accepted Answer

A) True 
 B)False

Question 5

The main purpose of a budget is to

Accepted Answer

A)  develop goals. 
B)  develop a financial plan. 
C)  give feedback to the plan. 
D)  monitor and control financial outcomes. 
E)  revise goals. 
A)  develop goals. 
B)  develop a financial plan. 
C)  give feedback to the plan. 
D)  monitor and control financial outcomes. 
E)  revise goals.

Question 6

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.
-Your car has a market value of $4,000 while the balance of the loan against it is now $2,500.You will list this car as net worth of [$4,000 | $1,500].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 7

I should not record ____ on an income/expense statement covering January 1 to June 30.

Accepted Answer

A)  an $800 refrigerator bought on credit May 30 
B)  a paid March telephone bill 
C)  health insurance premiums deducted from monthly pay checks 
D)  checking account service charges 
E)  groceries bought and paid for in June 
A)  an $800 refrigerator bought on credit May 30 
B)  a paid March telephone bill 
C)  health insurance premiums deducted from monthly pay checks 
D)  checking account service charges 
E)  groceries bought and paid for in June

Question 8

Net worth is greatest for those in their prime working years,about age 55.

Accepted Answer

A) True 
 B)False

Question 9

Jean and Jim have liquid assets of $3,600 and other assets of $42,800.Their total liabilities equal $26,000.What is their net worth? (Show all work.)

Accepted Answer

The answer of Jean and Jim have liquid assets of...

Question 10

Which of the following are not among the four categories accounting for three-quarters of consumer spending?

Accepted Answer

A)  Utilities 
B)  Clothing 
C)  Food 
D)  a and b 
E)  a, b, and c 
A)  Utilities 
B)  Clothing 
C)  Food 
D)  a and b 
E)  a, b, and c

Question 11

In a budget,"fun money" is a budget category used for family members to spend as they like without having to account for how it is spent.

Accepted Answer

A) True 
 B)False

Question 12

Mindy and Lou had liquid assets of $10,000 and current debts of $30,000.What is their liquidity ratio?

Accepted Answer

A)  25% 
B)  33% 
C)  67% 
D)  150% 
E)  300% 
A)  25% 
B)  33% 
C)  67% 
D)  150% 
E)  300%

Question 13

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 balance sheet provides a statement of your financial [position | performance].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 14

The most common budgeting period is a

Accepted Answer

A)  week. 
B)  month. 
C)  quarter. 
D)  semi-annually. 
E)  bi-weekly. 
A)  week. 
B)  month. 
C)  quarter. 
D)  semi-annually. 
E)  bi-weekly.

Question 15

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 liability would be listed on a balance sheet as the [amount originally borrowed | amount of the next loan payment to be made | none of these].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 16

What can you do if your budget shows an annual budget deficit?

Accepted Answer

A)  Liquidate enough savings and investments to meet the total budget shortfall for the year. 
B)  Borrow enough to meet the total budget shortfall for the year. 
C)  Cut low-priority expenses from the budget. 
D)  Increase Income. 
E)  All of the above. 
A)  Liquidate enough savings and investments to meet the total budget shortfall for the year. 
B)  Borrow enough to meet the total budget shortfall for the year. 
C)  Cut low-priority expenses from the budget. 
D)  Increase Income. 
E)  All of the above.

Question 17

A cash budget helps you:

Accepted Answer

A)  Monitor and control your finances. 
B)  Decide how to allocate your income to reach your financial goals. 
C)  Achieve your long-term financial goals. 
D)  All of the above. 
E)  A & B only. 
A)  Monitor and control your finances. 
B)  Decide how to allocate your income to reach your financial goals. 
C)  Achieve your long-term financial goals. 
D)  All of the above. 
E)  A & B only.

Question 18

Mike and Teresa Garza have a monthly gross income of $5,000,but they pay $1,000 per month in taxes.They also pay $2,000 per month in various loan payments.What is their debt service ratio?

Accepted Answer

A)  20% 
B)  30% 
C)  40% 
D)  50% 
E)  60% 
A)  20% 
B)  30% 
C)  40% 
D)  50% 
E)  60%

Question 19

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 your income needed to pay your [current liabilities | monthly loan payments].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 20

Using balance sheet information,the ____ ratio indicates your ability to meet current debt payments.

Accepted Answer

A)  solvency 
B)  liquidity 
C)  cash 
D)  savings 
E)  debt service 
A)  solvency 
B)  liquidity 
C)  cash 
D)  savings 
E)  debt service

A(n)____ would not be listed as an asset on your balance sheet.

Jamil invested $9,500 in an account he expects will earn 5% annually.Approximately how many years will it take for the account to double in value?

A budget is an orderly estimate of income and expenditures.

Only four categories of spending account for almost 90% of all consumer spending.

The main purpose of a budget is to

I should not record ____ on an income/expense statement covering January 1 to June 30.

Net worth is greatest for those in their prime working years,about age 55.

Jean and Jim have liquid assets of $3,600 and other assets of $42,800.Their total liabilities equal $26,000.What is their net worth? (Show all work.)

Which of the following are not among the four categories accounting for three-quarters of consumer spending?

In a budget,"fun money" is a budget category used for family members to spend as they like without having to account for how it is spent.

Mindy and Lou had liquid assets of $10,000 and current debts of $30,000.What is their liquidity ratio?

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 balance sheet provides a statement of your financial [position | performance].

The most common budgeting period is a

What can you do if your budget shows an annual budget deficit?

A cash budget helps you:

Mike and Teresa Garza have a monthly gross income of $5,000,but they pay $1,000 per month in taxes.They also pay $2,000 per month in various loan payments.What is their debt service ratio?

Using balance sheet information,the ____ ratio indicates your ability to meet current debt payments.

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

Planning for Retirement

Preserving Your Estate

Filters

Exam 2: Using Financial Statements and Budgets

A(n)____ would not be listed as an asset on your balance sheet.

Jamil invested $9,500 in an account he expects will earn 5% annually.Approximately how many years will it take for the account to double in value?

A budget is an orderly estimate of income and expenditures.

Only four categories of spending account for almost 90% of all consumer spending.

The main purpose of a budget is to

I should not record ____ on an income/expense statement covering January 1 to June 30.

Net worth is greatest for those in their prime working years,about age 55.

Jean and Jim have liquid assets of $3,600 and other assets of $42,800.Their total liabilities equal $26,000.What is their net worth? (Show all work.)

Which of the following are not among the four categories accounting for three-quarters of consumer spending?

In a budget,"fun money" is a budget category used for family members to spend as they like without having to account for how it is spent.

Mindy and Lou had liquid assets of $10,000 and current debts of $30,000.What is their liquidity ratio?

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 balance sheet provides a statement of your financial [position | performance].

The most common budgeting period is a

What can you do if your budget shows an annual budget deficit?

A cash budget helps you:

Mike and Teresa Garza have a monthly gross income of $5,000,but they pay $1,000 per month in taxes.They also pay $2,000 per month in various loan payments.What is their debt service ratio?

Using balance sheet information,the ____ ratio indicates your ability to meet current debt payments.

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

Planning for Retirement

Preserving Your Estate

Filters