Exam 2: Using Financial Statements and Budgets

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.Your ownership interest in this car is [$4,000 | $1,500].

The equity in your home is the difference between the loan balance and the purchase price.

The best place to keep a budget is in a safe deposit box.

The best approach to solving the problem of an annual budget deficit is generally to:

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. -Total assets on your balance sheet are $6,000 and liabilities are $2,000.Your solvency ratio would be [67% | 33%].

The income and expenditures statement examines your financial:

Balance sheets and income statements are most useful if prepared at least annually.

Using time value of money is important when planning for long-term goals.

If you use net salary as income on your budget,the expenditures section must include income and social security taxes.

Investments are intangible financial assets typically acquired to achieve long-term personal financial goals.

Assume that your total income for the current year is $35,000.Total expenses including the taxes of $5,000 is $30,000.Your savings ratio is:

On an income statement for the period from January 1 to June 30,_____ would not be included as an income.

The savings ratio indicates the percentage of after-tax income that is saved.

Sonny and Cher have a net worth of $35,000 and total assets of $200,000.If their revolving credit and unpaid bills total $2,200,what are their long-term liabilities?