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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 records on real estate?
Cash and items that are easily converted to cash
Assets - liabilities = net worth
Forever
Assets - liabilities - net worth

2. Insolvency?

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3. How is a net can flow determined?
Handling daily business - bills payed on time - taxes - investments
Fixed you know whats being payed each month
Money you make subtracted from how much you spend
Investments - wages - interest

4. What is a cash flow statement?
Personal income and expenditure statement
What you owe
Needs - goals - personal situation
Current (less 1 year) credit card bill - long term (more than a year) mortgage

5. What types of records would be stored on a home computer?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Sell your assets - get another job
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Budget - summary of checks - Convenience

6. How long should you keep tax return forms?
Inability to pay debts when they're due
6 years
Paper that you give to your employer telling them how much money to take out of your taxes
Investments - wages - interest

7. What are 3 types of personal financial statements?
Cash or check
Net worth statement
Indicates the difference between your total assets total liabilities at any given date.
Balance sheet - cash flow statement - budget

8. What is at the heart of financial planning?
Money you make subtracted from how much you spend
Cash flow - keeping records - plan (budget)
Daily spending - saving decisions
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards

9. What is a balance sheet also called?
Net worth statement
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Investments - wages - interest
What you own

10. What 3 things are spending decisions based upon?
Needs - goals - personal situation
Fixed - variable
Personal income and expenditure statement
FOREVER

11. How long should you keep birth certificates - social security cards - etc?
Needs - goals - personal situation
Personal income and expenditure statement
FOREVER
Inability to pay debts when they're due

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

13. What are the various types of assets?
Day to day financial activities used to manage personal financial stuff and security
Real estate - personal possessions - investment assets
Fixed - variable
Handling daily business - bills payed on time - taxes - investments

14. Liabilities?
What you owe
Personal employment records - tax records
FOREVER
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money

15. What are the 2 types of cash outflows?
What you owe
Paper that you give to your employer telling them how much money to take out of your taxes
Cash or check
Fixed - variable

16. What types of records go in a home file?
How ever long you need it!
Assessing (goals) - Planning (budget)
Personal employment records - tax records
6 years

17. What types of records go in a safety deposit box?
Balance sheet - cash flow statement - budget
Daily spending - saving decisions
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Budget - summary of checks - Convenience

18. What is money management?
Day to day financial activities used to manage personal financial stuff and security
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Investments - wages - interest
Cash flow - keeping records - plan (budget)

19. What 2 ways can a person be paid?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Cash or check
Indicates the difference between your total assets total liabilities at any given date.
The amount of money you make before taxes or deductions

20. What is the purpose of personal financial statements?
Personal income and expenditure statement
Sell your assets - get another job
Forever
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards

21. What are the steps in the budgeting process?
Assessing (goals) - Planning (budget)
Budget - summary of checks - Convenience
Fixed you know whats being payed each month
Personal income and expenditure statement

22. What are the benefits of having an organized system for financial records?
Daily spending - saving decisions
Assets - liabilities = net worth
Handling daily business - bills payed on time - taxes - investments
Investments - wages - interest

23. What is a w-4?
Sell your assets - get another job
Real estate - personal possessions - investment assets
Paper that you give to your employer telling them how much money to take out of your taxes
Money you make subtracted from how much you spend

24. What is the difference between a fixed and variable expense?
Fixed you know whats being payed each month
Indicates the difference between your total assets total liabilities at any given date.
Handling daily business - bills payed on time - taxes - investments
Sell your assets - get another job

25. What is a personal balance sheet?
Sell your assets - get another job
How ever long you need it!
Investments - wages - interest
A sheet of your finances that helps you come to terms with your net worth

26. What is a liquid asset?
Fixed - variable
Cash and items that are easily converted to cash
Cash or check
Real estate - personal possessions - investment assets

27. Assets?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
What you own
Paper that you give to your employer telling them how much money to take out of your taxes
Current (less 1 year) credit card bill - long term (more than a year) mortgage

28. What 3 components are listed on a personal balance sheet?
Cash flow - keeping records - plan (budget)
Investments - wages - interest
Assets - liabilities - net worth
Handling daily business - bills payed on time - taxes - investments

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

30. What are some sources of income?
Net worth statement
Cash flow - keeping records - plan (budget)
Investments - wages - interest
Record income - record cash outflows - determine net cash flows

31. What are various types of liabilities?
Assets - liabilities = net worth
Investments - wages - interest
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Budget - summary of checks - Convenience

32. What are the 3 components of money management?
Personal employment records - tax records
6 years
Cash flow - keeping records - plan (budget)
Cash or check

33. Cash flow can also be called?
6 years
Cash flow - keeping records - plan (budget)
Budget - summary of checks - Convenience
Personal income and expenditure statement

34. Net worth?
Sell your assets - get another job
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Indicates the difference between your total assets total liabilities at any given date.
Day to day financial activities used to manage personal financial stuff and security

35. What are the 3 components of a cash flow statement?
Indicates the difference between your total assets total liabilities at any given date.
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Real estate - personal possessions - investment assets
Record income - record cash outflows - determine net cash flows

36. What are some oppertunity cost associated with money management?
Paper that you give to your employer telling them how much money to take out of your taxes
Budget - summary of checks - Convenience
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Indicates the difference between your total assets total liabilities at any given date.

37. How is net worth calculated?
Assets - liabilities = net worth
Paper that you give to your employer telling them how much money to take out of your taxes
Forever
Cash or check

38. How can net worth be increased?
Sell your assets - get another job
What you owe
What you own
Personal income and expenditure statement