Question 1

Describe the four budgeting strategies suggested for dual income households.

Accepted Answer

Pooled Income: both incomes are combined...

Question 2

Anne spends a total of $2,000 a month to cover all living expenses. Which of the following would represent the appropriate emergency fund?

Accepted Answer

A)   $2,000 to $4,000
B)   $3,000 to $7,000
C)   $6,000 to $12,000
D)   $1,000 to $2,000
E)   $6,000F) A) and C)
G) C) and D)

Question 3

When one money management decision is selected, something else must be given up.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following would be considered a long-term liability?

Accepted Answer

A)   A charge account payment
B)   A 36 month car loan
C)   An installment loan
D)   An amount due for taxes
E)   The amount due on a credit cardF) A) and E)
G) C) and D)

Question 5

Most income tax documents and records should be kept in a safety deposit box.

Accepted Answer

A) True 
 B)False

Question 6

The difference between the amount budgeted and the actual amount is called a

Accepted Answer

A)   financial plan.
B)   current liability.
C)   change in net worth.
D)   budget variance.
E)   variable living expense.F) A) and E)
G) A) and D)

Question 7

The payment items that should be budgeted first are

Accepted Answer

A)   variable expenses.
B)   investment funds.
C)   fixed expenses.
D)   unplanned living expenses.
E)   entertainment expenses.F) A) and E)
G) B) and E)

Question 8

A family with $80,000 in assets and $22,000 of liabilities would have a net worth of:

Accepted Answer

A)   $80,000.
B)   $22,000.
C)   $58,000
D)   $102,000.
E)   $36,000.F) A) and E)
G) D) and E)

Question 9

____________ is the recommended budgeting strategy for dual income households where the two partners have trust and shared values and goals?

Accepted Answer

A)   Pooled income
B)   50/50
C)   Proportionate contributions
D)   Sharing the bills
E)   Sharing goalsF) B) and D)
G) B) and E)

Question 10

Which of the following situations is a person who could be insolvent?

Accepted Answer

A)   Assets $56,000; annual expenses $60,000
B)   Assets $68,000; net worth $22,000
C)   Liabilities $45,000; net worth $6,000
D)   Assets $60,000; liabilities $61,000
E)   Annual cash inflows $48,000; liabilities $50,000F) A) and E)
G) A) and D)

Question 11

Personal records current budget, cheque book(s) and bank statements.

Accepted Answer

A) True 
 B)False

Question 12

Improvements in a person's financial position are the result of:

Accepted Answer

A)   increased liabilities.
B)   reductions in earnings.
C)   increased savings and investments.
D)   increased purchases on credit.
E)   lower amounts deposited in savings.F) A) and E)
G) B) and D)

Question 13

List and briefly explain the 4 characteristics of a successful budget.

Accepted Answer

Money management experts advise that a s...

Question 14

An example of a personal and employment document is a:

Accepted Answer

A)   Social Insurance card.
B)   passbook.
C)   budget
D)   property tax bill.
E)   lease.F) All of the above
G) A) and D)

Question 15

Which of the following presents a summary of income and outflows for a period of time?

Accepted Answer

A)   A cash flow statement
B)   A bank statement
C)   An investment summary
D)   balance sheet
E)   An asset reportF) A) and D)
G) A) and B)

Question 16

The current financial position of an individual or family is best presented with the use of a(n)

Accepted Answer

A)   budget.
B)   cash flow statement.
C)   balance sheet.
D)   bank statement.
E)   time value of money report.F) All of the above
G) A) and B)

Question 17

The main purposes of personal financial statements are to:

Accepted Answer

A)   summarize the value of the items that you own and the amounts that you owe
B)   track your cash inflows by source and your outflows by type
C)   identify strengths and weaknesses in your current financial situation and provide data for use in filing your income tax return or applying for credit
D)   measure progress toward your financial goals
E)   all of the aboveF) B) and E)
G) C) and D)

Question 18

Definite financial obligations are referred to as variable expenses.

Accepted Answer

A) True 
 B)False

Question 19

Medical expenses, clothing, and telephone are examples of fixed expenses.

Accepted Answer

A) True 
 B)False

Question 20

Financial records that may need to be referred to on a regular basis should not be kept in a safety deposit box.

Accepted Answer

A) True 
 B)False

Exam 2: Money Management Strategy: Financial Statements and Budgeting

When one money management decision is selected, something else must be given up.

Correct AnswerverifiedShow Answer

The current financial position of an individual or family is best presented with the use of a(n)

Correct AnswerverifiedShow Answer

The payment items that should be budgeted first are

Correct AnswerverifiedShow Answer

Which of the following presents a summary of income and outflows for a period of time?

Correct AnswerverifiedShow Answer

An example of a personal and employment document is a:

Correct AnswerverifiedShow Answer

The main purposes of personal financial statements are to:

Correct AnswerverifiedShow Answer

A family with $80,000 in assets and $22,000 of liabilities would have a net worth of:

Correct AnswerverifiedShow Answer

The difference between the amount budgeted and the actual amount is called a

Correct AnswerverifiedShow Answer

Describe the four budgeting strategies suggested for dual income households.

Correct AnswerverifiedPooled Income: both incomes are combined...View AnswerShow Answer

List and briefly explain the 4 characteristics of a successful budget.

Correct AnswerverifiedMoney management experts advise that a s...View AnswerShow Answer

Which of the following would be considered a long-term liability?

Correct AnswerverifiedShow Answer

Financial records that may need to be referred to on a regular basis should not be kept in a safety deposit box.

Correct AnswerverifiedShow Answer

Most income tax documents and records should be kept in a safety deposit box.

Correct AnswerverifiedShow Answer

Which of the following situations is a person who could be insolvent?

Correct AnswerverifiedShow Answer

____________ is the recommended budgeting strategy for dual income households where the two partners have trust and shared values and goals?

Correct AnswerverifiedShow Answer

Personal records current budget, cheque book(s) and bank statements.

Correct AnswerverifiedShow Answer

Anne spends a total of $2,000 a month to cover all living expenses. Which of the following would represent the appropriate emergency fund?

Correct AnswerverifiedShow Answer

Improvements in a person's financial position are the result of:

Correct AnswerverifiedShow Answer

Medical expenses, clothing, and telephone are examples of fixed expenses.

Correct AnswerverifiedShow Answer

Definite financial obligations are referred to as variable expenses.

Correct AnswerverifiedShow Answer

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Pooled Income: both incomes are combined...
View Answer

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Money management experts advise that a s...
View Answer

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