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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?
Daily spending - saving decisions
Forever
Indicates the difference between your total assets total liabilities at any given date.
Real estate - personal possessions - investment assets

2. What is a w-4?
Personal employment records - tax records
What you owe
6 years
Paper that you give to your employer telling them how much money to take out of your taxes

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

4. What is a cash flow statement?
Forever
Personal employment records - tax records
Personal income and expenditure statement
Cash flow - keeping records - plan (budget)

5. What are the 2 types of cash outflows?
Fixed - variable
Cash flow - keeping records - plan (budget)
Cash or check
The amount of money you make before taxes or deductions

6. How long should you keep birth certificates - social security cards - etc?
Investments - wages - interest
Balance sheet - cash flow statement - budget
Daily spending - saving decisions
FOREVER

7. How is net worth calculated?
Day to day financial activities used to manage personal financial stuff and security
Assets - liabilities = net worth
Real estate - personal possessions - investment assets
Paper that you give to your employer telling them how much money to take out of your taxes

8. What are the steps in the budgeting process?
Assessing (goals) - Planning (budget)
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Cash or check
Real estate - personal possessions - investment assets

9. What 2 ways can a person be paid?
Net worth statement
Daily spending - saving decisions
Cash or check
Real estate - personal possessions - investment assets

10. What types of records go in a home file?
Assets - liabilities - net worth
Cash flow - keeping records - plan (budget)
Net worth statement
Personal employment records - tax records

11. What is the difference between a fixed and variable expense?
Cash flow - keeping records - plan (budget)
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

12. What are the benefits of having an organized system for financial records?
Personal income and expenditure statement
Cash flow - keeping records - plan (budget)
Handling daily business - bills payed on time - taxes - investments
FOREVER

13. What types of records would be stored on a home computer?
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Paper that you give to your employer telling them how much money to take out of your taxes
Budget - summary of checks - Convenience
Record income - record cash outflows - determine net cash flows

14. What is a personal balance sheet?
Real estate - personal possessions - investment assets
Assets - liabilities - net worth
Personal income and expenditure statement
A sheet of your finances that helps you come to terms with your net worth

15. What is money management?
Personal income and expenditure statement
Fixed - variable
Handling daily business - bills payed on time - taxes - investments
Day to day financial activities used to manage personal financial stuff and security

16. What are 3 types of personal financial statements?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Day to day financial activities used to manage personal financial stuff and security
Balance sheet - cash flow statement - budget
What you own

17. Net worth?
Budget - summary of checks - Convenience
Cash flow - keeping records - plan (budget)
A sheet of your finances that helps you come to terms with your net worth
Indicates the difference between your total assets total liabilities at any given date.

18. What is the purpose of personal financial statements?
Real estate - personal possessions - investment assets
Handling daily business - bills payed on time - taxes - investments
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Money you make subtracted from how much you spend

19. What types of records go in a safety deposit box?
The amount of money you make before taxes or deductions
Paper that you give to your employer telling them how much money to take out of your taxes
Record income - record cash outflows - determine net cash flows
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates

20. What are the various types of assets?
The amount of money you make before taxes or deductions
Personal income and expenditure statement
What you own
Real estate - personal possessions - investment assets

21. What is a balance sheet also called?
Daily spending - saving decisions
Net worth statement
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

22. How long should you keep tax return forms?
Paper that you give to your employer telling them how much money to take out of your taxes
6 years
Money you make subtracted from how much you spend
How ever long you need it!

23. What are the 3 components of a cash flow statement?
Net worth statement
Investments - wages - interest
Record income - record cash outflows - determine net cash flows
Current (less 1 year) credit card bill - long term (more than a year) mortgage

24. Liabilities?
Daily spending - saving decisions
What you owe
Sell your assets - get another job
Day to day financial activities used to manage personal financial stuff and security

25. Assets?
Real estate - personal possessions - investment assets
What you own
Record income - record cash outflows - determine net cash flows
6 years

26. What is a liquid asset?
Cash and items that are easily converted to cash
Cash or check
Assets - liabilities - net worth
How ever long you need it!

27. What 3 things are spending decisions based upon?
What you own
Needs - goals - personal situation
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
How ever long you need it!

28. What are the 3 components of money management?
Fixed you know whats being payed each month
Cash flow - keeping records - plan (budget)
What you owe
Record income - record cash outflows - determine net cash flows

29. What is gross pay?
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Cash and items that are easily converted to cash
The amount of money you make before taxes or deductions
FOREVER

30. What are some oppertunity cost associated with money management?
Real estate - personal possessions - investment assets
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Record income - record cash outflows - determine net cash flows
Indicates the difference between your total assets total liabilities at any given date.

31. What are some sources of income?
Cash and items that are easily converted to cash
Forever
Investments - wages - interest
Personal employment records - tax records

32. How can net worth be increased?
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Indicates the difference between your total assets total liabilities at any given date.
Sell your assets - get another job
Balance sheet - cash flow statement - budget

33. What is at the heart of financial planning?
Assets - liabilities = net worth
FOREVER
Daily spending - saving decisions
Personal income and expenditure statement

34. How long should you keep records on personal property and investments?
What you owe
What you own
Personal income and expenditure statement
How ever long you need it!

35. What are various types of liabilities?
Personal income and expenditure statement
Record income - record cash outflows - determine net cash flows
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

36. Cash flow can also be called?
Personal income and expenditure statement
Cash and items that are easily converted to cash
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Balance sheet - cash flow statement - budget

37. Insolvency?

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38. How is a net can flow determined?
Daily spending - saving decisions
Assets - liabilities - net worth
Money you make subtracted from how much you spend
Real estate - personal possessions - investment assets