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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 gross pay?
FOREVER
Assessing (goals) - Planning (budget)
Needs - goals - personal situation
The amount of money you make before taxes or deductions

2. What are some oppertunity cost associated with money management?
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Money you make subtracted from how much you spend
Net worth statement
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money

3. How long should you keep birth certificates - social security cards - etc?
Daily spending - saving decisions
Personal income and expenditure statement
6 years
FOREVER

4. What is a cash flow statement?
Personal employment records - tax records
Fixed you know whats being payed each month
How ever long you need it!
Personal income and expenditure statement

5. What types of records go in a home file?
Assets - liabilities = net worth
A sheet of your finances that helps you come to terms with your net worth
Needs - goals - personal situation
Personal employment records - tax records

6. What are various types of liabilities?
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
Day to day financial activities used to manage personal financial stuff and security
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates

7. What is the difference between a fixed and variable expense?
What you owe
Record income - record cash outflows - determine net cash flows
Paper that you give to your employer telling them how much money to take out of your taxes
Fixed you know whats being payed each month

8. What types of records would be stored on a home computer?
Handling daily business - bills payed on time - taxes - investments
Fixed you know whats being payed each month
Budget - summary of checks - Convenience
Record income - record cash outflows - determine net cash flows

9. What 2 ways can a person be paid?
Day to day financial activities used to manage personal financial stuff and security
Daily spending - saving decisions
Cash or check
Net worth statement

10. What are the 2 types of cash outflows?
Handling daily business - bills payed on time - taxes - investments
Assessing (goals) - Planning (budget)
A sheet of your finances that helps you come to terms with your net worth
Fixed - variable

11. How long should you keep tax return forms?
Assets - liabilities = net worth
6 years
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

12. What is a balance sheet also called?
Net worth statement
Paper that you give to your employer telling them how much money to take out of your taxes
Investments - wages - interest
How ever long you need it!

13. What are 3 types of personal financial statements?
Balance sheet - cash flow statement - budget
Net worth statement
Assets - liabilities = net worth
Investments - wages - interest

14. What is at the heart of financial planning?
Paper that you give to your employer telling them how much money to take out of your taxes
Inability to pay debts when they're due
Daily spending - saving decisions
A sheet of your finances that helps you come to terms with your net worth

15. What 3 things are spending decisions based upon?
What you owe
Indicates the difference between your total assets total liabilities at any given date.
Needs - goals - personal situation
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates

16. What are the benefits of having an organized system for financial records?
Handling daily business - bills payed on time - taxes - investments
Record income - record cash outflows - determine net cash flows
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
6 years

17. How is a net can flow determined?
Cash flow - keeping records - plan (budget)
Handling daily business - bills payed on time - taxes - investments
Money you make subtracted from how much you spend
Record income - record cash outflows - determine net cash flows

18. Insolvency?

19. What are the various types of assets?
Net worth statement
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
Real estate - personal possessions - investment assets

20. What is a w-4?
Assessing (goals) - Planning (budget)
Needs - goals - personal situation
Personal employment records - tax records
Paper that you give to your employer telling them how much money to take out of your taxes

21. How long should you keep records on personal property and investments?
Day to day financial activities used to manage personal financial stuff and security
6 years
How ever long you need it!
Personal employment records - tax records

22. What is a personal balance sheet?
A sheet of your finances that helps you come to terms with your net worth
Assessing (goals) - Planning (budget)
Indicates the difference between your total assets total liabilities at any given date.
Personal income and expenditure statement

23. What are the steps in the budgeting process?
Assessing (goals) - Planning (budget)
What you own
Sell your assets - get another job
Personal income and expenditure statement

24. How long should you keep records on real estate?
Forever
Budget - summary of checks - Convenience
Investments - wages - interest
Personal income and expenditure statement

25. Assets?
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Forever
What you own
Cash flow - keeping records - plan (budget)

26. What is a liquid asset?
Cash and items that are easily converted to cash
Budget - summary of checks - Convenience
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
6 years

27. What are the 3 components of money management?
The amount of money you make before taxes or deductions
Cash flow - keeping records - plan (budget)
Personal income and expenditure statement
Assessing (goals) - Planning (budget)

28. What are some sources of income?
Cash and items that are easily converted to cash
Inability to pay debts when they're due
Cash or check
Investments - wages - interest

29. What types of records go in a safety deposit box?
Daily spending - saving decisions
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Assets - liabilities = net worth
Sell your assets - get another job

30. Cash flow can also be called?
Net worth statement
Budget - summary of checks - Convenience
FOREVER
Personal income and expenditure statement

31. Liabilities?
Fixed you know whats being payed each month
Daily spending - saving decisions
Investments - wages - interest
What you owe

32. What is money management?
Fixed - variable
Indicates the difference between your total assets total liabilities at any given date.
Handling daily business - bills payed on time - taxes - investments
Day to day financial activities used to manage personal financial stuff and security

33. How is net worth calculated?
Assets - liabilities = net worth
FOREVER
Personal income and expenditure statement
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates

34. What are the 3 components of a cash flow statement?
Assets - liabilities = net worth
Personal income and expenditure statement
6 years
Record income - record cash outflows - determine net cash flows

35. What 3 components are listed on a personal balance sheet?
Assets - liabilities - net worth
Record income - record cash outflows - determine net cash flows
Assets - liabilities = net worth
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards

36. What is the purpose of personal financial statements?
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Assets - liabilities - net worth
Cash flow - keeping records - plan (budget)
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards

37. Net worth?
Paper that you give to your employer telling them how much money to take out of your taxes
How ever long you need it!
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.

38. How can net worth be increased?
Fixed you know whats being payed each month
Sell your assets - get another job
Net worth statement
Personal income and expenditure statement