Money Management
Net worth is the amount owed to others.
False
A cash flow statement uses this equation: Assets-Liabilities=Net worth
False this equation is for a personal balance sheet.
What will increase the net worth of a household: decreased amount owed on credit cards Or increase spending by $5 per day.
What is decrease amount owed on credit cards?
What is a better situation to be in a surplus or a deficit?
What is a surplus?
Liabilities divided by net worth.
What is Debt ratio?
The amount you would have left if all assets were sold and all debts were paid in full.
What is Net Worth?
A cash flow statement uses this equation: Total cash received during the period - Cash outflows during the time period = Cash surplus (or deficit)
True
Which is cash inflow: a payment for rent OR income from employment.
What is income from employment?
What are SMART goals?
What is specific, measurable, action-oriented, realistic & time-based?
Liquid assets divided by current liabilities.
What is current ratio?
Assets - Cash outflow is the equation to calculate Net Worth.
False-the correct statement should be is assets-liabilities = net worth.
When creating a personal balance sheet, which of the is considered to be a personal possession asset? A 5 year old TV or Cash in a checking account
What is a 5 year-old TV set?
Which appears as a cash outflow on a cash flow statement? Loan payment OR Balance of mortgage
What is Loan payment?
What does SWOT stand for?
What are strengths, weaknesses, opportunities & threats?
Liquid assets divided by monthly expenses.
What is Liquidity ratio?
Current liabilities are the debts you must pay within a short time, usually less than a year.
True
When creating personal balance sheet which is an investment asset? Cash value of life insurance OR Retirement account 401K
What is a Retirement account such as a 401K?
Financial experts recommend monthly savings of ____of gross income.
What is 5-10%?
The differences between the amount budgeted and the actual amount received or spent.
What is budget variance?
Monthly credit payments divided by take-home pay.
What is Debt-payments ratio?
Liquid assets can be easily converted to cash.
False
When creating a personal balance sheet, which is a current liability?
Education loan OR Medical Bill
What is a Medical Bill?
Financial experts recommend a debt/payment ratio of less than ____ % of take home pay.
What is 20-30%?
What is the inability to pay debts when they are due it occurs when a person's liabilities far exceed assets.
What is insolvency?
Amount saved each month divided by gross monthly income.
What is savings ratio?