Vocab
What is a Goal?
A desired end towards which efforts are directed;
An aim or purpose;
Things or people one aspires to or wants to emulate
What are the three parts of the Accounting Equation?
A________ = L__________ + O________ E________
Assets = Liabilities + Owner's Equity
What is financial planning?
Financial planning is the process of setting goals, assessing the current financial situation, and developing strategies to achieve those goals.
Who should you contact if you are the victim of a fraud?
1. The Federal Trade Commission (FTC)
2. The three major credit reporting agencies.
3. The fraud department at your credit card issuers, bank, and other places where you have accounts
Write 2 reasons you should invest in the stock market.
Build wealth
Beat inflation
Passive income
For funsies
What is an investment Portfolio?
A collection of investments.
Guess the Percentage! The group whose guess is closest to the actual answer receives the points:
A survey conducted by the Association of Chartered Certified Accountants (ACCA) found that __% of business leaders consider accounting and finance skills crucial for career success.
86%
What are the 2 types of expenses found on an average household budget?
Fixed and Variable.
What is "financial risk"?
The possibility of losing money on an investment or business venture.
What are the 2 ways to profit from stocks?
1. Dividends
2. Capital Gain (value increase)
What is depreciation?
An accounting method used to allocate the cost of an asset over its useful life.
It represents the decrease in the value or worth of a tangible asset due to factors such as wear and tear, obsolescence, or usage.
What does "salvage value" mean when calculating depreciation?
This is what the company expects to receive for the asset if it's sold, scrapped, or traded in. The longer the useful life, the lower the residual value; sometimes, the salvage value is zero.
Why is it important to have a financial plan? Provide 2 reasons.
1. Achieve financial stability
2. Meet financial goals
3. Mitigate risks
4. Optimize asset management
5. Plan for a secure future
What are the 3 types of goals you might set?
HINT: think of TIME
Short-term (few days-few weeks)
Intermediate (few months-one year)
Long-term (one year+)
Provide 3/6 strategies I provided you with for investing in the stock market.
1. Start investing as soon as you can and continue to invest over your lifetime.
2. Start with investing small amounts of money.
3. Begin your investment journey with a retirement account.
4. Buy & hold on to your investments for minimum 3-5 years.
5. Do your research!!
6. Trust your gut!
What is a Ponzi/Pyramid Scheme?
An investing scam in which money from a constant stream of new investors is used to pay off earlier investors.
Finish the Revenue Model equation:
Revenue - Expenses = ______________
Net Income
What does it mean when your budget is "balanced"?
Money coming in (earnings plus borrowing) must equal money going out (spending plus saving).
What does the SMART in SMART goals stand for?
S: Specific
M: Measurable
A: Achievable/Attainable
R: Relevant
T: Timely/Time-Bound
Why is it important to have a diversified portfolio?
Diversification reduces overall risk because not all choices will perform poorly at the same time. If one choice does not do well, the others will likely make up some or all of the loss.
What is the definition of Accounting?
Accounting is the systematic process of recording, summarizing, analyzing, and interpreting financial transactions and events of a business entity.
Sometimes, cashless payments can take several days for the transaction to complete! Because of this, there are two main methods for recording accounting transactions: ______________ & _______________ principles
Accrual & Matching
What are 2 things you could do to balance your budget?
Cut expenses
Borrow money/use savings
Increase income
Who pulled off the largest Ponzi Scheme in history?
*Double points if you guess how much $ he stole!*
Bernie Madoff
$65 billion
Name the 3 most popular stock indexes in the U.S.
NASDAQ
Dow Jones
S&P 500