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Financial Statements And Budgeting

Instructions:

Answer 38 questions in 15 minutes.
If you are not ready to take this test, you can study here.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.

This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.

1. What is a cash flow statement?
The amount of money you make before taxes or deductions
Personal employment records - tax records
Personal income and expenditure statement
Fixed you know whats being payed each month

2. What are the 2 types of cash outflows?
Paper that you give to your employer telling them how much money to take out of your taxes
What you own
Budget - summary of checks - Convenience
Fixed - variable

3. What types of records go in a home file?
Day to day financial activities used to manage personal financial stuff and security
Personal employment records - tax records
Money you make subtracted from how much you spend
Personal income and expenditure statement

4. What is a w-4?
Paper that you give to your employer telling them how much money to take out of your taxes
Cash and items that are easily converted to cash
Cash flow - keeping records - plan (budget)
Current (less 1 year) credit card bill - long term (more than a year) mortgage

5. What are the steps in the budgeting process?
Money you make subtracted from how much you spend
Assessing (goals) - Planning (budget)
A sheet of your finances that helps you come to terms with your net worth
Handling daily business - bills payed on time - taxes - investments

6. How is a net can flow determined?
A sheet of your finances that helps you come to terms with your net worth
Fixed you know whats being payed each month
What you owe
Money you make subtracted from how much you spend

7. What is gross pay?
6 years
Day to day financial activities used to manage personal financial stuff and security
The amount of money you make before taxes or deductions
Current (less 1 year) credit card bill - long term (more than a year) mortgage

8. What types of records would be stored on a home computer?
Budget - summary of checks - Convenience
Daily spending - saving decisions
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Personal income and expenditure statement

9. What 3 components are listed on a personal balance sheet?
Assets - liabilities - net worth
What you own
Budget - summary of checks - Convenience
A sheet of your finances that helps you come to terms with your net worth

10. What are 3 types of personal financial statements?
Balance sheet - cash flow statement - budget
Handling daily business - bills payed on time - taxes - investments
Record income - record cash outflows - determine net cash flows
Budget - summary of checks - Convenience

11. Insolvency?

12. What are the benefits of having an organized system for financial records?
Cash flow - keeping records - plan (budget)
Handling daily business - bills payed on time - taxes - investments
Fixed - variable
Inability to pay debts when they're due

13. What are the 3 components of a cash flow statement?
Record income - record cash outflows - determine net cash flows
FOREVER
6 years
Investments - wages - interest

14. What is a liquid asset?
Cash and items that are easily converted to cash
What you own
A sheet of your finances that helps you come to terms with your net worth
Assets - liabilities - net worth

15. What are the 3 components of money management?
Forever
Cash and items that are easily converted to cash
Cash flow - keeping records - plan (budget)
Money you make subtracted from how much you spend

16. How can net worth be increased?
Sell your assets - get another job
Indicates the difference between your total assets total liabilities at any given date.
A sheet of your finances that helps you come to terms with your net worth
Balance sheet - cash flow statement - budget

17. Assets?
Investments - wages - interest
Inability to pay debts when they're due
What you own
Cash and items that are easily converted to cash

18. What is a balance sheet also called?
Real estate - personal possessions - investment assets
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Net worth statement
Fixed - variable

19. What is at the heart of financial planning?
Indicates the difference between your total assets total liabilities at any given date.
Daily spending - saving decisions
Budget - summary of checks - Convenience
6 years

20. How long should you keep tax return forms?
Handling daily business - bills payed on time - taxes - investments
Assessing (goals) - Planning (budget)
What you own
6 years

21. What types of records go in a safety deposit box?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Balance sheet - cash flow statement - budget
Personal income and expenditure statement
Handling daily business - bills payed on time - taxes - investments

22. How long should you keep birth certificates - social security cards - etc?
Investments - wages - interest
Record income - record cash outflows - determine net cash flows
Personal income and expenditure statement
FOREVER

23. What is a personal balance sheet?
Personal income and expenditure statement
Assets - liabilities = net worth
Cash or check
A sheet of your finances that helps you come to terms with your net worth

24. What 2 ways can a person be paid?
FOREVER
How ever long you need it!
Cash or check
Assessing (goals) - Planning (budget)

25. What is money management?
Day to day financial activities used to manage personal financial stuff and security
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Cash flow - keeping records - plan (budget)
The amount of money you make before taxes or deductions

26. What are the various types of assets?
The amount of money you make before taxes or deductions
Real estate - personal possessions - investment assets
Record income - record cash outflows - determine net cash flows
Balance sheet - cash flow statement - budget

27. What is the purpose of personal financial statements?
Inability to pay debts when they're due
Sell your assets - get another job
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Fixed you know whats being payed each month

28. How long should you keep records on real estate?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Forever
Paper that you give to your employer telling them how much money to take out of your taxes

29. What are some oppertunity cost associated with money management?
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Fixed you know whats being payed each month

30. How is net worth calculated?
What you own
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
A sheet of your finances that helps you come to terms with your net worth
Assets - liabilities = net worth

31. What are various types of liabilities?
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Money you make subtracted from how much you spend
Day to day financial activities used to manage personal financial stuff and security
Net worth statement

32. What are some sources of income?
Assets - liabilities = net worth
Daily spending - saving decisions
Investments - wages - interest
Forever

33. How long should you keep records on personal property and investments?
How ever long you need it!
6 years
Personal income and expenditure statement
Indicates the difference between your total assets total liabilities at any given date.

34. What is the difference between a fixed and variable expense?
Net worth statement
Fixed you know whats being payed each month
What you own
How ever long you need it!

35. Cash flow can also be called?
Needs - goals - personal situation
Personal income and expenditure statement
Day to day financial activities used to manage personal financial stuff and security
Daily spending - saving decisions

36. Liabilities?
The amount of money you make before taxes or deductions
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Investments - wages - interest
What you owe

37. What 3 things are spending decisions based upon?
Investments - wages - interest
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Needs - goals - personal situation
What you owe

38. Net worth?
Paper that you give to your employer telling them how much money to take out of your taxes
Indicates the difference between your total assets total liabilities at any given date.
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Fixed - variable