Question 1

To determine a person's solvency,which financial document should be consulted?

Accepted Answer

A)  Cash flow statement
B)  Budget
C)  Debt consolidation statement
D)  Personal balance sheet
E)  Credit reportF) C) and D)
G) All of the above

Question 2

Andrew Smith has developed a budget that he follows each month.This is a budget that he keeps in his head.He does not write anything down,nor does he use a computer to keep track of this budget.What type of budget has Andrew created?

Accepted Answer

A)  Mental budget
B)  Physical budget
C)  Written budget
D)  Computerized budget
E)  Cloud budgetF) None of the above
G) A) and B)

Question 3

A person's net worth is computed by:

Accepted Answer

A)  adding assets and liabilities.
B)  deducting current living expenses from total assets.
C)  subtracting total liabilities from total assets.
D)  subtracting assets from current liabilities.
E)  adding liabilities and budgeted expenses.F) B) and C)
G) None of the above

Question 4

Calculate the debt ratio for an individual who has $45,000 in assets and $17,500 in liabilities.

Accepted Answer

A)  0.26
B)  2.57
C)  0.45
D)  0.39
E)  1.75F) All of the above
G) C) and D)

Question 5

A home file should be used for:

Accepted Answer

A)  storing all financial documents and records.
B)  financial records for current needs.
C)  documents that require maximum security.
D)  obsolete financial documents.
E)  records that are difficult to replace.F) A) and E)
G) A) and D)

Question 6

A family with $50,000 in assets and $22,000 of liabilities would have a net worth of:

Accepted Answer

A)  $50,000.
B)  $28,000.
C)  $22,000.
D)  $67,000.
E)  $41,000.F) A) and B)
G) A) and C)

Question 7

Financial goals should take a SMART approach with goals that are:

Accepted Answer

A)  Time-based.
B)  Realistic.
C)  Action-oriented.
D)  Specific and Measurable.
E)  All of theseF) All of the above
G) A) and E)

Question 8

Diane Rucker lives with her two sons,ages 6 and 9.They have had difficulty managing their finances.What purposes could a budget serve for the Ruckers? What actions would you suggest for the budgeting process to be successful?

Accepted Answer

A budget can help the Ruckers live withi...

Question 9

Total earnings of a person minus the deductions for taxes and other items is called:

Accepted Answer

A)  budgeted income.
B)  gross pay.
C)  net worth.
D)  total revenue.
E)  take-home pay.F) C) and E)
G) All of the above

Question 10

Funds set aside for retirement is an example of a(n) ________ asset.

Accepted Answer

A)  personal
B)  common
C)  investment
D)  household
E)  budgetedF) None of the above
G) B) and D)

Question 11

The debt ratio is calculated as:

Accepted Answer

A)  Net worth divided by liabilities.
B)  Monthly credit payments divided by take-home pay.
C)  Liabilities divided by assets.
D)  Liquid assets divided by current liabilities.
E)  Liquid assets divided by monthly expenses.F) C) and D)
G) B) and C)

Question 12

A person with erratic or seasonal income may need an emergency fund of ________ months or more.

Accepted Answer

A)  2
B)  3
C)  6
D)  10
E)  12F) B) and C)
G) D) and E)

Question 13

One of the main purposes of personal financial statements is to:

Accepted Answer

A)  Report your future financial position relating to the value of items owned and owed.
B)  Measure your progress toward financial goals.
C)  Maintain information about your professional work activities.
D)  Provide data you can use when rating a restaurant.
E)  Provide data you can use when applying for a job.F) D) and E)
G) A) and D)

Exam 3: Money Management Strategy: Financial Statements and Budgeting

Andrew Smith has developed a budget that he follows each month.This is a budget that he keeps in his head.He does not write anything down,nor does he use a computer to keep track of this budget.What type of budget has Andrew created?

Correct Answer
verified

A person with erratic or seasonal income may need an emergency fund of ________ months or more.

Correct Answer
verified

To determine a person's solvency,which financial document should be consulted?

Correct Answer
verified

Financial goals should take a SMART approach with goals that are:

Correct Answer
verified

A person's net worth is computed by:

Correct Answer
verified

One of the main purposes of personal financial statements is to:

Correct Answer
verified

Diane Rucker lives with her two sons,ages 6 and 9.They have had difficulty managing their finances.What purposes could a budget serve for the Ruckers? What actions would you suggest for the budgeting process to be successful?

Correct Answer
verified
A budget can help the Ruckers live withi...
View Answer

Calculate the debt ratio for an individual who has $45,000 in assets and $17,500 in liabilities.

Correct Answer
verified

A family with $50,000 in assets and $22,000 of liabilities would have a net worth of:

Correct Answer
verified

A home file should be used for:

Correct Answer
verified

Funds set aside for retirement is an example of a(n) ________ asset.

Correct Answer
verified

Total earnings of a person minus the deductions for taxes and other items is called:

Correct Answer
verified

The debt ratio is calculated as:

Correct Answer
verified

Exam 3: Money Management Strategy: Financial Statements and Budgeting

Andrew Smith has developed a budget that he follows each month.This is a budget that he keeps in his head.He does not write anything down,nor does he use a computer to keep track of this budget.What type of budget has Andrew created?

Correct AnswerverifiedShow Answer

A person with erratic or seasonal income may need an emergency fund of ________ months or more.

Correct AnswerverifiedShow Answer

To determine a person's solvency,which financial document should be consulted?

Correct AnswerverifiedShow Answer

Financial goals should take a SMART approach with goals that are:

Correct AnswerverifiedShow Answer

A person's net worth is computed by:

Correct AnswerverifiedShow Answer

One of the main purposes of personal financial statements is to:

Correct AnswerverifiedShow Answer

Diane Rucker lives with her two sons,ages 6 and 9.They have had difficulty managing their finances.What purposes could a budget serve for the Ruckers? What actions would you suggest for the budgeting process to be successful?

Correct AnswerverifiedA budget can help the Ruckers live withi...View AnswerShow Answer

Calculate the debt ratio for an individual who has $45,000 in assets and $17,500 in liabilities.

Correct AnswerverifiedShow Answer

A family with $50,000 in assets and $22,000 of liabilities would have a net worth of:

Correct AnswerverifiedShow Answer

A home file should be used for:

Correct AnswerverifiedShow Answer

Funds set aside for retirement is an example of a(n) ________ asset.

Correct AnswerverifiedShow Answer

Total earnings of a person minus the deductions for taxes and other items is called:

Correct AnswerverifiedShow Answer

The debt ratio is calculated as:

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
A budget can help the Ruckers live withi...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified