Question 1

The income and expenditures statement provides a measure of financial performance over a period of time.

Accepted Answer

A) True 
 B)False  True

Question 2

You may be under-budgeting for food if you continually have monthly deficits in the food category.

Accepted Answer

A) True 
 B)False  True

Question 3

Another term sometimes used instead of net worth is:

Accepted Answer

A)  assets. 
B)  net debts. 
C)  long-term liabilities 
D)  equity. 
E)  liquid assets. 
A)  assets. 
B)  net debts. 
C)  long-term liabilities 
D)  equity. 
E)  liquid assets. D

Question 4

Michael and Sandy purchased a home for $100,000 five years ago.If it appreciated 6% annually,what is it worth today?

Accepted Answer

A)  $100,000 
B)  $106,000 
C)  $130,000 
D)  $133,823 
E)  $135,603 
A)  $100,000 
B)  $106,000 
C)  $130,000 
D)  $133,823 
E)  $135,603

Question 5

Construct a balance sheet from the following information.Be sure the format is correct.

Accepted Answer

The answer of Construct a balance sheet from the following...

Question 6

Balance sheet liabilities should be recorded at their:

Accepted Answer

A)  original outstanding balance. 
B)  year-end outstanding balance. 
C)  average outstanding balance. 
D)  current outstanding balance. 
E)  none of these. 
A)  original outstanding balance. 
B)  year-end outstanding balance. 
C)  average outstanding balance. 
D)  current outstanding balance. 
E)  none of these.

Question 7

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.
-If your expenses exceed your income,the bottom line of your income/expense statement will show a [surplus | deficit].

Accepted Answer

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

Question 8

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 primary function of preparing financial statements at the end of the current period is to provide a picture of your [actual | projected] financial position.

Accepted Answer

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

Question 9

Sam and his wife Ann purchased a home in Lubbock,Texas in 1980 for $100,000.Their original home mortgage was for $90,000.The house has a current market value of $175,000 and a replacement value of $200,000.They still owe $55,000 on their home mortgage.Sam and Ann are now constructing their balance sheet.How should their home be reflected on their current personal balance sheet?

Accepted Answer

A)  $200,000 asset and $55,000 liability 
B)  $200,000 asset and $90,000 liability 
C)  $175,000 asset and $55,000 liability 
D)  $175,000 asset and $90,000 liability 
E)  $100,000 asset and $55,000 liability 
A)  $200,000 asset and $55,000 liability 
B)  $200,000 asset and $90,000 liability 
C)  $175,000 asset and $55,000 liability 
D)  $175,000 asset and $90,000 liability 
E)  $100,000 asset and $55,000 liability

Question 10

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

Accepted Answer

A)  Utilities 
B)  Food 
C)  Transportation 
D)  Housing 
E)  Personal insurance and pensions 
A)  Utilities 
B)  Food 
C)  Transportation 
D)  Housing 
E)  Personal insurance and pensions

Question 11

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.
-Short-term goals are usually based on a maximum period of [one year | five years].

Accepted Answer

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

Question 12

Mandy and Jeff have a net worth of $25,000 and total assets of $140,000.If their revolving credit and unpaid bills total $2,200,what are their total liabilities?

Accepted Answer

A)  $115,000 
B)  $140,000 
C)  $142,200 
D)  $165,000 
E)  $167,200 
A)  $115,000 
B)  $140,000 
C)  $142,200 
D)  $165,000 
E)  $167,200

Question 13

Only the current month's payment on your mortgage loans would be listed on the balance sheet as a liability.

Accepted Answer

A) True 
 B)False

Question 14

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.
-Financial planning and budgeting [do | do not] mean the same thing.

Accepted Answer

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

Question 15

A budget is a:

Accepted Answer

A)  plan that calculates the interest on loan. 
B)  schedule of personal investments. 
C)  list of prepaid expenses. 
D)  detailed financial forecast. 
E)  set of personal financial objectives. 
A)  plan that calculates the interest on loan. 
B)  schedule of personal investments. 
C)  list of prepaid expenses. 
D)  detailed financial forecast. 
E)  set of personal financial objectives.

Question 16

Net income (after taxes)should be used when developing an income and expense statement.

Accepted Answer

A) True 
 B)False

Question 17

Inability to reach short-term goals will significantly affect your ability to reach long-term goals.

Accepted Answer

A) True 
 B)False

Question 18

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 19

The income statement includes information on your latest paycheck.

Accepted Answer

A) True 
 B)False

Question 20

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.
-[Borrowing money from relatives | cutting low-priority expenses] is the preferable way to deal with budget deficits.

Accepted Answer

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

The income and expenditures statement provides a measure of financial performance over a period of time.

You may be under-budgeting for food if you continually have monthly deficits in the food category.

Another term sometimes used instead of net worth is:

Michael and Sandy purchased a home for $100,000 five years ago.If it appreciated 6% annually,what is it worth today?

Construct a balance sheet from the following information.Be sure the format is correct.

Balance sheet liabilities should be recorded at their:

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

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. -Short-term goals are usually based on a maximum period of [one year | five years].

Mandy and Jeff have a net worth of $25,000 and total assets of $140,000.If their revolving credit and unpaid bills total $2,200,what are their total liabilities?

Only the current month's payment on your mortgage loans would be listed on the balance sheet as a liability.

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. -Financial planning and budgeting [do | do not] mean the same thing.

A budget is a:

Net income (after taxes)should be used when developing an income and expense statement.

Inability to reach short-term goals will significantly affect your ability to reach long-term goals.

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?

The income statement includes information on your latest paycheck.

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

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Exam 2: Using Financial Statements and Budgets

The income and expenditures statement provides a measure of financial performance over a period of time.

You may be under-budgeting for food if you continually have monthly deficits in the food category.

Another term sometimes used instead of net worth is:

Michael and Sandy purchased a home for $100,000 five years ago.If it appreciated 6% annually,what is it worth today?

Construct a balance sheet from the following information.Be sure the format is correct.

Balance sheet liabilities should be recorded at their:

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

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. -Short-term goals are usually based on a maximum period of [one year | five years].

Mandy and Jeff have a net worth of $25,000 and total assets of $140,000.If their revolving credit and unpaid bills total $2,200,what are their total liabilities?

Only the current month's payment on your mortgage loans would be listed on the balance sheet as a liability.

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. -Financial planning and budgeting [do | do not] mean the same thing.

A budget is a:

Net income (after taxes)should be used when developing an income and expense statement.

Inability to reach short-term goals will significantly affect your ability to reach long-term goals.

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?

The income statement includes information on your latest paycheck.

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