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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 w-4?
Cash or check
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Paper that you give to your employer telling them how much money to take out of your taxes
Personal employment records - tax records

2. What is a liquid asset?
Cash and items that are easily converted to cash
Fixed - variable
Paper that you give to your employer telling them how much money to take out of your taxes
Net worth statement

3. What are some sources of income?
Investments - wages - interest
A sheet of your finances that helps you come to terms with your net worth
Personal employment records - tax records
Real estate - personal possessions - investment assets

4. 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
Money you make subtracted from how much you spend

5. Insolvency?

6. Assets?
Fixed - variable
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
What you own

7. What is a balance sheet also called?
Net worth statement
Cash or check
Assets - liabilities - net worth
Balance sheet - cash flow statement - budget

8. How long should you keep records on personal property and investments?
Cash flow - keeping records - plan (budget)
Budget - summary of checks - Convenience
Money you make subtracted from how much you spend
How ever long you need it!

9. Cash flow can also be called?
Budget - summary of checks - Convenience
Personal income and expenditure statement
Fixed - variable
Needs - goals - personal situation

10. Liabilities?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Paper that you give to your employer telling them how much money to take out of your taxes
A sheet of your finances that helps you come to terms with your net worth
What you owe

11. What are the benefits of having an organized system for financial records?
Handling daily business - bills payed on time - taxes - investments
Daily spending - saving decisions
FOREVER
Fixed you know whats being payed each month

12. How long should you keep records on real estate?
Investments - wages - interest
Forever
What you owe
A sheet of your finances that helps you come to terms with your net worth

13. What is the difference between a fixed and variable expense?
Record income - record cash outflows - determine net cash flows
Fixed you know whats being payed each month
A sheet of your finances that helps you come to terms with your net worth
Assets - liabilities - net worth

14. What are the 2 types of cash outflows?
Fixed - variable
Day to day financial activities used to manage personal financial stuff and security
Paper that you give to your employer telling them how much money to take out of your taxes
How ever long you need it!

15. What are the 3 components of a cash flow statement?
Inability to pay debts when they're due
Needs - goals - personal situation
Record income - record cash outflows - determine net cash flows
How ever long you need it!

16. What 3 things are spending decisions based upon?
Needs - goals - personal situation
Assets - liabilities = net worth
Personal income and expenditure statement
Assessing (goals) - Planning (budget)

17. What types of records would be stored on a home computer?
Personal employment records - tax records
Fixed - variable
Assessing (goals) - Planning (budget)
Budget - summary of checks - Convenience

18. What are the 3 components of money management?
Cash flow - keeping records - plan (budget)
FOREVER
Personal employment records - tax records
Fixed - variable

19. What is money management?
Assets - liabilities - net worth
Assessing (goals) - Planning (budget)
Cash and items that are easily converted to cash
Day to day financial activities used to manage personal financial stuff and security

20. What types of records go in a safety deposit box?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Net worth statement
The amount of money you make before taxes or deductions
Assets - liabilities - net worth

21. What is at the heart of financial planning?
Budget - summary of checks - Convenience
What you own
Daily spending - saving decisions
Paper that you give to your employer telling them how much money to take out of your taxes

22. How long should you keep birth certificates - social security cards - etc?
FOREVER
Cash and items that are easily converted to cash
The amount of money you make before taxes or deductions
Assets - liabilities = net worth

23. How is a net can flow determined?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Needs - goals - personal situation
Money you make subtracted from how much you spend
6 years

24. What are the steps in the budgeting process?
Assessing (goals) - Planning (budget)
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Inability to pay debts when they're due
Cash or check

25. What are 3 types of personal financial statements?
Balance sheet - cash flow statement - budget
Record income - record cash outflows - determine net cash flows
Cash and items that are easily converted to cash
Budget - summary of checks - Convenience

26. What types of records go in a home file?
Fixed - variable
Personal employment records - tax records
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
A sheet of your finances that helps you come to terms with your net worth

27. How is net worth calculated?
Budget - summary of checks - Convenience
Assets - liabilities = net worth
Personal employment records - tax records
A sheet of your finances that helps you come to terms with your net worth

28. What are various types of liabilities?
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Inability to pay debts when they're due
How ever long you need it!
Personal income and expenditure statement

29. What is gross pay?
A sheet of your finances that helps you come to terms with your net worth
Assets - liabilities = net worth
The amount of money you make before taxes or deductions
Investments - wages - interest

30. Net worth?
Indicates the difference between your total assets total liabilities at any given date.
Daily spending - saving decisions
Cash flow - keeping records - plan (budget)
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards

31. What are the various types of assets?
Record income - record cash outflows - determine net cash flows
Personal employment records - tax records
6 years
Real estate - personal possessions - investment assets

32. What is a cash flow statement?
Personal income and expenditure statement
Fixed - variable
Needs - goals - personal situation
Day to day financial activities used to manage personal financial stuff and security

33. What is a personal balance sheet?
Inability to pay debts when they're due
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
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards

34. What is the purpose of personal financial statements?
Cash flow - keeping records - plan (budget)
What you own
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
FOREVER

35. What are some oppertunity cost associated with money management?
Handling daily business - bills payed on time - taxes - investments
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Assets - liabilities = net worth
Record income - record cash outflows - determine net cash flows

36. How long should you keep tax return forms?
A sheet of your finances that helps you come to terms with your net worth
Cash flow - keeping records - plan (budget)
Assets - liabilities = net worth
6 years

37. What 3 components are listed on a personal balance sheet?
Cash flow - keeping records - plan (budget)
How ever long you need it!
Sell your assets - get another job
Assets - liabilities - net worth

38. How can net worth be increased?
6 years
Sell your assets - get another job
Assets - liabilities = net worth
Personal employment records - tax records