Excel
Ch. 7
Ch. 8
Ch. 9
Conceptual
100
Which lines of an excel budget should be underlined once?
End of variable expenses, end of fixed expenses
100
A project with an initial investment of $400,000 will bring in cash flows of $65,000 per year. What is the payback period of this investment? Round your answer to the closest year.
6 years
100
According to the general rule of thumb, what percentage of your budget should you spend on wants?
30%
100
Using the cost formula provided, how much would be spent on equipment rental if 100 diving hours were used?
$5000
100
Define activity variance.
A difference in the number of units produced, hours worked, etc.
200
Which lines of an excel budget should be underlined twice?
NOI
200
Given that the discount rate is 12%, what is the NPV of Project X?
$14,332
200
How many months of expenses should be saved in an emergency fund?
3-6 months (budgeting document says 6)
200
Calculate the actual budget if the company provided 24 cruises for 1,400 passengers. 
$30,396
200
When does the *simple* payback period formula apply?
Only when cash flows are the same every year.
300
Explain how you would make a "variance percentage" column in excel.
Variance/Planning budget total
300
Given that the discount rate is 12%, what is the NPV of Project y?
$10,594
300
Name the 2nd baby step to financial freedom.
Focus on debt
300
Which expense had the highest variance? Is it favorable or unfavorable?
Wages and salaries, $494, unfavorable
300
If actual activity is greater than planned, what kind of variance would you expect in variable expenses (favorable, unfavorable, not enough info)?
Unfavorable (had to spend more money to support making more units/working more hours)
400
How many decimal places are appropriate for dollar amounts?
Zero
400
As the discount rate rate increases, the PV of a given future cash flow also increases. Do you agree? Explain.
This is false - As discount rate increases, PV of future cash flows decreases.
400
According to the personal budgeting document, what is the maximum yearly contribution for a Roth IRA?
$6,000 (or $500 a month)
400
What is the main reason for the difference between these two budgets? How could it have been solved?
Difference in revenue, raising the selling price
400
What is the advantage of an IRA over a 401k?
The earnings/withdrawals after retirement are not taxed.
500
Write out an "IF" statement that would generate "U" or "F" to describe a variance.
=IF(F9>=G9,"F","U"
500
Your annual cash flows equal $70,000. Your boss tells you that you have a piece of equipment that cost $50,000 to purchase that the company will no longer use in 6 years. You can then sell this piece of equipment for $4000. Factoring in the straight-line depreciation of the equipment, what is your yearly NOI?
$62,333
500
Name the 5th baby step of financial freedom.
Save for your children's college fund
500
The variance between the actual and flexible budget is called _______ and is due to ________.
Revenue and spending variance, differences between selling prices and the cost of variable/fixed expenses.
500
Is a dollar today worth more or less than a dollar tomorrow? What is this concept called? Name one capital budgeting method that takes this concept into account.
More, time value of money, NPV