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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 are the 3 components of a cash flow statement?
Record income - record cash outflows - determine net cash flows
6 years
Personal income and expenditure statement
The amount of money you make before taxes or deductions

2. What is a cash flow statement?
The amount of money you make before taxes or deductions
Needs - goals - personal situation
Personal income and expenditure statement
FOREVER

3. What are some oppertunity cost associated with money management?
Assessing (goals) - Planning (budget)
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Investments - wages - interest
Inability to pay debts when they're due

4. What are the 3 components of money management?
Personal income and expenditure statement
Investments - wages - interest
Net worth statement
Cash flow - keeping records - plan (budget)

5. How is a net can flow determined?
Money you make subtracted from how much you spend
Inability to pay debts when they're due
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
FOREVER

6. How long should you keep records on real estate?
Forever
Investments - wages - interest
Personal employment records - tax records
Inability to pay debts when they're due

7. What are the steps in the budgeting process?
What you own
Balance sheet - cash flow statement - budget
Assessing (goals) - Planning (budget)
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money

8. What types of records would be stored on a home computer?
Budget - summary of checks - Convenience
Fixed you know whats being payed each month
What you own
The amount of money you make before taxes or deductions

9. What is gross pay?
Forever
Paper that you give to your employer telling them how much money to take out of your taxes
The amount of money you make before taxes or deductions
Daily spending - saving decisions

10. What are the benefits of having an organized system for financial records?
Money you make subtracted from how much you spend
Sell your assets - get another job
Handling daily business - bills payed on time - taxes - investments
6 years

11. What are various types of liabilities?
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Inability to pay debts when they're due
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

12. How is net worth calculated?
Assets - liabilities = net worth
Money you make subtracted from how much you spend
Real estate - personal possessions - investment assets
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards

13. What is a w-4?
Fixed - variable
Paper that you give to your employer telling them how much money to take out of your taxes
FOREVER
Money you make subtracted from how much you spend

14. How long should you keep tax return forms?
Cash and items that are easily converted to cash
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money
Sell your assets - get another job
6 years

15. How can net worth be increased?
Personal income and expenditure statement
Sell your assets - get another job
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Assets - liabilities = net worth

16. What is a personal balance sheet?
Indicates the difference between your total assets total liabilities at any given date.
Personal income and expenditure statement
6 years
A sheet of your finances that helps you come to terms with your net worth

17. What is a balance sheet also called?
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Sell your assets - get another job
Net worth statement
What you own

18. What is the purpose of personal financial statements?
FOREVER
Assessing (goals) - Planning (budget)
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Personal income and expenditure statement

19. What are some sources of income?
Investments - wages - interest
Assessing (goals) - Planning (budget)
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

20. What types of records go in a safety deposit box?
Net worth statement
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Credit vs future income - current living expenses vs savings/interest - saving purchases vs interest money

21. Liabilities?
Needs - goals - personal situation
Indicates the difference between your total assets total liabilities at any given date.
Assessing (goals) - Planning (budget)
What you owe

22. What types of records go in a home file?
Net worth statement
Needs - goals - personal situation
Personal employment records - tax records
Forever

23. What are 3 types of personal financial statements?
Sell your assets - get another job
Balance sheet - cash flow statement - budget
Forever
Personal income and expenditure statement

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

25. Insolvency?

26. How long should you keep records on personal property and investments?
Cash flow - keeping records - plan (budget)
How ever long you need it!
Personal employment records - tax records
Needs - goals - personal situation

27. Net worth?
Fixed you know whats being payed each month
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
How ever long you need it!

28. What is money management?
Day to day financial activities used to manage personal financial stuff and security
Handling daily business - bills payed on time - taxes - investments
Investments - wages - interest
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates

29. What is the difference between a fixed and variable expense?
Fixed you know whats being payed each month
Day to day financial activities used to manage personal financial stuff and security
Money you make subtracted from how much you spend
What you owe

30. How long should you keep birth certificates - social security cards - etc?
Indicates the difference between your total assets total liabilities at any given date.
Real estate - personal possessions - investment assets
FOREVER
Inability to pay debts when they're due

31. Cash flow can also be called?
Paper that you give to your employer telling them how much money to take out of your taxes
How ever long you need it!
Personal income and expenditure statement
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates

32. What 3 components are listed on a personal balance sheet?
Budget - summary of checks - Convenience
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates
Report your financial sit - measure progress towards goals - provide data for preparing taxes/credit cards
Assets - liabilities - net worth

33. Assets?
What you own
Real estate - personal possessions - investment assets
Needs - goals - personal situation
Cash or check

34. What is at the heart of financial planning?
Assets - liabilities - net worth
Daily spending - saving decisions
Current (less 1 year) credit card bill - long term (more than a year) mortgage
Forever

35. What 3 things are spending decisions based upon?
Handling daily business - bills payed on time - taxes - investments
Needs - goals - personal situation
6 years
Paper that you give to your employer telling them how much money to take out of your taxes

36. What are the 2 types of cash outflows?
Investments - wages - interest
Fixed you know whats being payed each month
Fixed - variable
Handling daily business - bills payed on time - taxes - investments

37. What 2 ways can a person be paid?
Cash or check
Handling daily business - bills payed on time - taxes - investments
Personal income and expenditure statement
What you own

38. What is a liquid asset?
Cash or check
Cash flow - keeping records - plan (budget)
Cash and items that are easily converted to cash
Birth marriage - death certificates - copy of will - Citizenship papers - stock and bond certificates