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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. How long should you keep birth certificates - social security cards - etc?
FOREVER
Personal employment records - tax records
A sheet of your finances that helps you come to terms with your net worth
Paper that you give to your employer telling them how much money to take out of your taxes

2. Net worth?
Indicates the difference between your total assets total liabilities at any given date.
What you owe
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Assets - liabilities - net worth

3. How long should you keep tax return forms?
Personal employment records - tax records
Balance sheet - cash flow statement - budget
6 years
Cash and items that are easily converted to cash

4. What is a cash flow statement?
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Personal income and expenditure statement

5. What are the 2 types of cash outflows?
Personal income and expenditure statement
Personal income and expenditure statement
Fixed - variable
Budget - summary of checks - Convenience

6. What are the steps in the budgeting process?
Assessing (goals) - Planning (budget)
Fixed you know whats being payed each month
Inability to pay debts when they're due
Forever

7. What is at the heart of financial planning?
Cash or check
Sell your assets - get another job
Cash and items that are easily converted to cash
Daily spending - saving decisions

8. Insolvency?

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9. What 3 things are spending decisions based upon?
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Needs - goals - personal situation
Indicates the difference between your total assets total liabilities at any given date.
FOREVER

10. How is a net can flow determined?
Cash flow - keeping records - plan (budget)
How ever long you need it!
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Money you make subtracted from how much you spend

11. What is a w-4?
Personal income and expenditure statement
FOREVER
Assets - liabilities = net worth
Paper that you give to your employer telling them how much money to take out of your taxes

12. What is a personal balance sheet?
Assessing (goals) - Planning (budget)
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Daily spending - saving decisions
A sheet of your finances that helps you come to terms with your net worth

13. What 2 ways can a person be paid?
Record income - record cash outflows - determine net cash flows
Cash or check
A sheet of your finances that helps you come to terms with your net worth
Fixed you know whats being payed each month

14. How long should you keep records on real estate?
Forever
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Daily spending - saving decisions
Assets - liabilities = net worth

15. What is the purpose of personal financial statements?
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Sell your assets - get another job
Fixed you know whats being payed each month
Cash or check

16. What types of records go in a safety deposit box?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Handling daily business - bills payed on time - taxes - investments
Cash and items that are easily converted to cash
Sell your assets - get another job

17. What is money management?
Day to day financial activities used to manage personal financial stuff and security
Assessing (goals) - Planning (budget)
Daily spending - saving decisions
How ever long you need it!

18. How long should you keep records on personal property and investments?
Handling daily business - bills payed on time - taxes - investments
How ever long you need it!
FOREVER
Balance sheet - cash flow statement - budget

19. Liabilities?
Record income - record cash outflows - determine net cash flows
Personal income and expenditure statement
Daily spending - saving decisions
What you owe

20. What are the 3 components of a cash flow statement?
Net worth statement
Paper that you give to your employer telling them how much money to take out of your taxes
Cash or check
Record income - record cash outflows - determine net cash flows

21. What are 3 types of personal financial statements?
What you owe
Record income - record cash outflows - determine net cash flows
Balance sheet - cash flow statement - budget
Assessing (goals) - Planning (budget)

22. Cash flow can also be called?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Personal income and expenditure statement
Day to day financial activities used to manage personal financial stuff and security
Cash or check

23. What is gross pay?
Cash flow - keeping records - plan (budget)
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Real estate - personal possessions - investment assets
The amount of money you make before taxes or deductions

24. What are some oppertunity cost associated with money management?
6 years
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
Investments - wages - interest

25. How is net worth calculated?
Investments - wages - interest
Assets - liabilities = net worth
Forever
The amount of money you make before taxes or deductions

26. What are various types of liabilities?
The amount of money you make before taxes or deductions
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Personal employment records - tax records
Personal income and expenditure statement

27. How can net worth be increased?
Inability to pay debts when they're due
Sell your assets - get another job
Assets - liabilities = net worth
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money

28. What are the 3 components of money management?
A sheet of your finances that helps you come to terms with your net worth
Cash flow - keeping records - plan (budget)
FOREVER
What you owe

29. What 3 components are listed on a personal balance sheet?
Assets - liabilities = net worth
Cash or check
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Assets - liabilities - net worth

30. What types of records go in a home file?
Assets - liabilities = net worth
Investments - wages - interest
Personal employment records - tax records
A sheet of your finances that helps you come to terms with your net worth

31. What is a balance sheet also called?
A sheet of your finances that helps you come to terms with your net worth
Net worth statement
Budget - summary of checks - Convenience
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money

32. What are the benefits of having an organized system for financial records?
Indicates the difference between your total assets total liabilities at any given date.
Paper that you give to your employer telling them how much money to take out of your taxes
Handling daily business - bills payed on time - taxes - investments
Personal income and expenditure statement

33. What are the various types of assets?
FOREVER
A sheet of your finances that helps you come to terms with your net worth
Money you make subtracted from how much you spend
Real estate - personal possessions - investment assets

34. What types of records would be stored on a home computer?
Budget - summary of checks - Convenience
Record income - record cash outflows - determine net cash flows
Fixed you know whats being payed each month
Personal employment records - tax records

35. What is the difference between a fixed and variable expense?
Fixed you know whats being payed each month
Assets - liabilities - net worth
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Personal income and expenditure statement

36. What are some sources of income?
Assessing (goals) - Planning (budget)
Sell your assets - get another job
Investments - wages - interest
FOREVER

37. What is a liquid asset?
Day to day financial activities used to manage personal financial stuff and security
The amount of money you make before taxes or deductions
Cash and items that are easily converted to cash
Fixed - variable

38. Assets?
Cash and items that are easily converted to cash
Cash flow - keeping records - plan (budget)
What you own
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates