Question 1

A person's net worth would increase as a result of:

Accepted Answer

A)  reduced amounts owed to others.
B)  reduced earnings.
C)  increased spending for current living expenses.
D)  decreased value of personal possessions.
E)  decreased value of investments.F) B) and E)
G) A) and D) A

Question 2

When preparing her monthly budget,Marge Kent has projected income of $4,600.Each month she pays $1,200 in rent,$60 for life insurance,and $240 for her auto loan.What percentage of her budget goes for these fixed expenses?

Accepted Answer

A)  6 percent
B)  12 percent
C)  27 percent
D)  33 percent
E)  40 percentF) A) and E)
G) B) and E)

Question 3

Patricia McDonald has determined that the value of her liquid assets is $4,500,the value of her real estate is $128,000,the value of her personal possessions is $62,000,and the value of her investment assets is $73,000.She has also determined the value of her current liabilities is $7,500 and the value of her long term liabilities is $98,000.What is Patricia's net worth?

Accepted Answer

A)  $267,500
B)  $105,500
C)  $162,000
D)  $205,500
E)  $132,000F) C) and E)
G) B) and C)

Question 4

Jamie McFarland has determined that the value of her liquid assets is $4,500,the value of her real estate is $108,000,the value of her personal possessions is $62,000 and the value of her investment assets is $73,000.She has also determined the value of her current liabilities is $9,500 and the value of her long term liabilities is $68,000.What is Jamie's net worth?

Accepted Answer

A)  $267,500
B)  $105,500
C)  $170,000
D)  $205,500
E)  None of theseF) A) and C)
G) A) and B)

Question 5

A budget deficit would result when a person's or family's:

Accepted Answer

A)  actual expenses are less than planned expenses.
B)  actual expenses are greater than planned expenses.
C)  actual expenses equal planned expenses.
D)  assets exceed liabilities.
E)  net worth decreases.F) A) and E)
G) A) and B)

Question 6

The value of items owned minus the amounts owed to others equals:

Accepted Answer

A)  net assets.
B)  net worth.
C)  total liabilities.
D)  total income.
E)  budgeted expenses.F) A) and B)
G) D) and E)

Question 7

Darlene Elkin has the following financial amounts: checking account $850,savings account $3,500,credit card balance $300,jewelry $1,600,real estate valued at $78,000,a mortgage on the real estate of $23,000.What is the total of Darlene's assets? What actions could she take to increase her net worth?

Accepted Answer

Total assets = $850 + $3,500 + $1,600 + ...

Question 8

A personal balance sheet:

Accepted Answer

A)  predicts income and expenses.
B)  reports what an individual or a family owns and owes.
C)  reports income and expenses for an individual or a family.
D)  predicts net worth of an economic entity.
E)  analyzes debt payment activities.F) A) and E)
G) None of the above

Question 9

In order to calculate savings ratio,the amount saved each month is divided by net income.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following items is something that would typically not be stored in a safety deposit box?

Accepted Answer

A)  Rare coins
B)  Copy of will
C)  Automobile title
D)  Marriage certificate
E)  CheckbookF) B) and D)
G) A) and B)

Question 11

When it comes to savings,most Americans:

Accepted Answer

A)  have an adequate emergency fund.
B)  devote large portions of their income to savings.
C)  find saving difficult.
D)  keep substantial amounts in a regular savings account.
E)  reduce the amount they save during their working life.F) B) and D)
G) A) and D) C

Question 12

What are the main components of a personal balance sheet and a cash flow statement? What is the main purpose of each of these personal financial statements?

Accepted Answer

A balance sheet reports the current financial position of an individual or family; it includes assets,liabilities,and net worth.A cash flow statement is designed to report the actual inflow and outflow of cash during a given time period for a person; it includes current income and cash payments.

Question 13

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

Accepted Answer

A)  W-2 forms
B)  Personal financial statements
C)  Warranties
D)  Military papers
E)  Checking account statementsF) C) and D)
G) A) and D)

Question 14

Diane Rossiter lives with her two sons,ages 6 and 9.They have had difficulty managing their finances.What purposes could a budget serve for the Rossiters? What actions would you suggest for the budgeting process to be successful?

Accepted Answer

A budget can help a person or family liv...

Question 15

The Hernandez family budgets $420 a month for food.Last month they spent $413,which creates a:

Accepted Answer

A)  budget surplus of $7.
B)  budget deficit of $7.
C)  budget surplus of $420.
D)  budget deficit of $413.
E)  balanced budget.F) A) and E)
G) C) and D)

Question 16

Kyle Burroughs has decided to put $25 more per week in his savings account.He knows this will reduce his ability to go out to eat each week but thinks building his savings is important.This would be an example of:

Accepted Answer

A)  a budget variance.
B)  an opportunity cost.
C)  a balance sheet.
D)  an accounting error.
E)  a budget anomaly.F) A) and E)
G) A) and B)

Question 17

A person has $1,250 in liabilities,monthly savings of $200,and monthly gross income of $2,500.What is the person's savings ratio?

Accepted Answer

A)  0.52
B)  0.08
C)  2.35
D)  0.16
E)  12.58F) C) and D)
G) A) and E)

Question 18

A common deduction from a person's paycheck is for:

Accepted Answer

A)  interest.
B)  taxes.
C)  rent.
D)  unemployment.
E)  current liabilities.F) B) and C)
G) D) and E)

Question 19

Jonathan Wynn has developed a budget that he follows each month.Jonathan has an envelope for each type of expenditure.After he cashes his paycheck,he puts the amount of cash in each envelope that he plans to spend on that category each month.What type of budget has Jonathan created?

Accepted Answer

A)  Mental budget
B)  Physical budget
C)  Written budget
D)  Computerized budget
E)  None of theseF) A) and C)
G) None of the above

Question 20

Nick Boss has a savings account with $550 in it.He knows that he can withdraw this money whenever he wishes.This would be an example of:

Accepted Answer

A)  money management.
B)  a personal possession.
C)  a limited asset.
D)  a liquid asset.
E)  net worth analysis.F) B) and D)
G) C) and D)

Exam 3: Money Management Strategy: Financial Statements and Budgeting

A person's net worth would increase as a result of:

Correct Answer
verified
A

When preparing her monthly budget,Marge Kent has projected income of $4,600.Each month she pays $1,200 in rent,$60 for life insurance,and $240 for her auto loan.What percentage of her budget goes for these fixed expenses?

Correct Answer
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Correct Answer
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Correct Answer
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A budget deficit would result when a person's or family's:

Correct Answer
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The value of items owned minus the amounts owed to others equals:

Correct Answer
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Darlene Elkin has the following financial amounts: checking account $850,savings account $3,500,credit card balance $300,jewelry $1,600,real estate valued at $78,000,a mortgage on the real estate of $23,000.What is the total of Darlene's assets? What actions could she take to increase her net worth?

Correct Answer
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Total assets = $850 + $3,500 + $1,600 + ...
View Answer

A personal balance sheet:

Correct Answer
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In order to calculate savings ratio,the amount saved each month is divided by net income.

Correct Answer
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Which of the following items is something that would typically not be stored in a safety deposit box?

Correct Answer
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When it comes to savings,most Americans:

Correct Answer
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C

What are the main components of a personal balance sheet and a cash flow statement? What is the main purpose of each of these personal financial statements?

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

Correct Answer
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Diane Rossiter lives with her two sons,ages 6 and 9.They have had difficulty managing their finances.What purposes could a budget serve for the Rossiters? What actions would you suggest for the budgeting process to be successful?

Correct Answer
verified
A budget can help a person or family liv...
View Answer

The Hernandez family budgets $420 a month for food.Last month they spent $413,which creates a:

Correct Answer
verified

Kyle Burroughs has decided to put $25 more per week in his savings account.He knows this will reduce his ability to go out to eat each week but thinks building his savings is important.This would be an example of:

Correct Answer
verified

A person has $1,250 in liabilities,monthly savings of $200,and monthly gross income of $2,500.What is the person's savings ratio?

Correct Answer
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A common deduction from a person's paycheck is for:

Correct Answer
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Jonathan Wynn has developed a budget that he follows each month.Jonathan has an envelope for each type of expenditure.After he cashes his paycheck,he puts the amount of cash in each envelope that he plans to spend on that category each month.What type of budget has Jonathan created?

Correct Answer
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Nick Boss has a savings account with $550 in it.He knows that he can withdraw this money whenever he wishes.This would be an example of:

Correct Answer
verified

Exam 3: Money Management Strategy: Financial Statements and Budgeting

A person's net worth would increase as a result of:

Correct AnswerverifiedA

When preparing her monthly budget,Marge Kent has projected income of $4,600.Each month she pays $1,200 in rent,$60 for life insurance,and $240 for her auto loan.What percentage of her budget goes for these fixed expenses?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A budget deficit would result when a person's or family's:

Correct AnswerverifiedShow Answer

The value of items owned minus the amounts owed to others equals:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedTotal assets = $850 + $3,500 + $1,600 + ...View AnswerShow Answer

A personal balance sheet:

Correct AnswerverifiedShow Answer

In order to calculate savings ratio,the amount saved each month is divided by net income.

Correct AnswerverifiedShow Answer

Which of the following items is something that would typically not be stored in a safety deposit box?

Correct AnswerverifiedShow Answer

When it comes to savings,most Americans:

Correct AnswerverifiedC

What are the main components of a personal balance sheet and a cash flow statement? What is the main purpose of each of these personal financial statements?

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

Correct AnswerverifiedShow Answer

Diane Rossiter lives with her two sons,ages 6 and 9.They have had difficulty managing their finances.What purposes could a budget serve for the Rossiters? What actions would you suggest for the budgeting process to be successful?

Correct AnswerverifiedA budget can help a person or family liv...View AnswerShow Answer

The Hernandez family budgets $420 a month for food.Last month they spent $413,which creates a:

Correct AnswerverifiedShow Answer

Kyle Burroughs has decided to put $25 more per week in his savings account.He knows this will reduce his ability to go out to eat each week but thinks building his savings is important.This would be an example of:

Correct AnswerverifiedShow Answer

A person has $1,250 in liabilities,monthly savings of $200,and monthly gross income of $2,500.What is the person's savings ratio?

Correct AnswerverifiedShow Answer

A common deduction from a person's paycheck is for:

Correct AnswerverifiedShow Answer

Jonathan Wynn has developed a budget that he follows each month.Jonathan has an envelope for each type of expenditure.After he cashes his paycheck,he puts the amount of cash in each envelope that he plans to spend on that category each month.What type of budget has Jonathan created?

Correct AnswerverifiedShow Answer

Nick Boss has a savings account with $550 in it.He knows that he can withdraw this money whenever he wishes.This would be an example of:

Correct AnswerverifiedShow Answer

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A

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Total assets = $850 + $3,500 + $1,600 + ...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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C

Correct Answer
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Correct Answer
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A budget can help a person or family liv...
View Answer

Correct Answer
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