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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 is a net can flow determined?
Day to day financial activities used to manage personal financial stuff and security
Money you make subtracted from how much you spend
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

2. Insolvency?

3. What is the purpose of personal financial statements?
Cash or check
FOREVER
Inability to pay debts when they're due
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards

4. What is gross pay?
A sheet of your finances that helps you come to terms with your net worth
The amount of money you make before taxes or deductions
FOREVER
Cash flow - keeping records - plan (budget)

5. What are the steps in the budgeting process?
Handling daily business - bills payed on time - taxes - investments
What you owe
Budget - summary of checks - Convenience
Assessing (goals) - Planning (budget)

6. What is a balance sheet also called?
Handling daily business - bills payed on time - taxes - investments
Sell your assets - get another job
What you own
Net worth statement

7. How can net worth be increased?
Cash and items that are easily converted to cash
Personal income and expenditure statement
Real estate - personal possessions - investment assets
Sell your assets - get another job

8. What are the various types of assets?
Personal income and expenditure statement
What you own
Real estate - personal possessions - investment assets
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards

9. What is a personal balance sheet?
A sheet of your finances that helps you come to terms with your net worth
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

10. What is a liquid asset?
What you own
Assets - liabilities = net worth
Cash and items that are easily converted to cash
Needs - goals - personal situation

11. How long should you keep tax return forms?
Cash or check
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
6 years
A sheet of your finances that helps you come to terms with your net worth

12. What types of records go in a home file?
Budget - summary of checks - Convenience
Personal employment records - tax records
Investments - wages - interest
Handling daily business - bills payed on time - taxes - investments

13. What are the 2 types of cash outflows?
Real estate - personal possessions - investment assets
Cash or check
Fixed - variable
Forever

14. What are the benefits of having an organized system for financial records?
Personal income and expenditure statement
Handling daily business - bills payed on time - taxes - investments
What you own
Indicates the difference between your total assets total liabilities at any given date.

15. How long should you keep records on personal property and investments?
Personal income and expenditure statement
Budget - summary of checks - Convenience
How ever long you need it!
Record income - record cash outflows - determine net cash flows

16. What is a cash flow statement?
Real estate - personal possessions - investment assets
Indicates the difference between your total assets total liabilities at any given date.
Personal income and expenditure statement
Assets - liabilities - net worth

17. What is at the heart of financial planning?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Balance sheet - cash flow statement - budget
Daily spending - saving decisions
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money

18. What are the 3 components of a cash flow statement?
What you own
Cash flow - keeping records - plan (budget)
Record income - record cash outflows - determine net cash flows
Assets - liabilities = net worth

19. How long should you keep birth certificates - social security cards - etc?
Fixed you know whats being payed each month
FOREVER
Needs - goals - personal situation
Assets - liabilities = net worth

20. What are the 3 components of money management?
Cash flow - keeping records - plan (budget)
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
Indicates the difference between your total assets total liabilities at any given date.

21. Net worth?
Daily spending - saving decisions
How ever long you need it!
Indicates the difference between your total assets total liabilities at any given date.
Assessing (goals) - Planning (budget)

22. How long should you keep records on real estate?
Forever
Cash flow - keeping records - plan (budget)
A sheet of your finances that helps you come to terms with your net worth
Needs - goals - personal situation

23. What are 3 types of personal financial statements?
Record income - record cash outflows - determine net cash flows
Balance sheet - cash flow statement - budget
What you owe
Cash or check

24. What is a w-4?
Net worth statement
Cash flow - keeping records - plan (budget)
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

25. What types of records go in a safety deposit box?
Investments - wages - interest
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
What you own
Forever

26. What are some sources of income?
Personal income and expenditure statement
Investments - wages - interest
Cash or check
Assessing (goals) - Planning (budget)

27. Cash flow can also be called?
Cash and items that are easily converted to cash
Cash flow - keeping records - plan (budget)
Personal income and expenditure statement
Fixed - variable

28. What types of records would be stored on a home computer?
Budget - summary of checks - Convenience
Assessing (goals) - Planning (budget)
Forever
Inability to pay debts when they're due

29. How is net worth calculated?
Cash and items that are easily converted to cash
The amount of money you make before taxes or deductions
Assets - liabilities = net worth
Sell your assets - get another job

30. What 3 things are spending decisions based upon?
Handling daily business - bills payed on time - taxes - investments
Needs - goals - personal situation
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

31. What are some oppertunity cost associated with money management?
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Forever
Personal income and expenditure statement
Indicates the difference between your total assets total liabilities at any given date.

32. What 3 components are listed on a personal balance sheet?
What you own
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Sell your assets - get another job
Assets - liabilities - net worth

33. Liabilities?
Assets - liabilities = net worth
Cash and items that are easily converted to cash
6 years
What you owe

34. Assets?
What you own
Balance sheet - cash flow statement - budget
FOREVER
Sell your assets - get another job

35. What is money management?
Daily spending - saving decisions
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
Real estate - personal possessions - investment assets

36. What 2 ways can a person be paid?
Cash or check
Fixed you know whats being payed each month
Handling daily business - bills payed on time - taxes - investments
The amount of money you make before taxes or deductions

37. What are various types of liabilities?
Day to day financial activities used to manage personal financial stuff and security
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Handling daily business - bills payed on time - taxes - investments
What you own

38. What is the difference between a fixed and variable expense?
A sheet of your finances that helps you come to terms with your net worth
Fixed you know whats being payed each month
Forever
Net worth statement