ugh finance

The major function of personal financial planning is toA. Achieve personal economic satisfaction.B. Reduce taxes.C. Increase savings.D. Obtain adequate insurance protection.E. Improve your credit rating. A. Achieve personal economic satisfaction.
The Rule of 72 is:A. The number of steps required to complete a financial planB. Used to calculate interest rates for savingsC. The legal code for requiring companies to provide a match on retirement savings D. Used to estimate how fast prices will double using a given annual inflation rate E. A tool to determine the number of years until retirement for an employee D. Used to estimate how fast prices will double using a given annual inflation rate
The problem of bankruptcy is associated with overuse and misuse of credit in the ______________ component of financial planning.A. SharingB. SavingsC. Obtaining D. Borrowing E. Protecting D. Borrowing
Patrick Guitman recently graduated from college with $20,000 in student loans and $5,000 in credit card debt. He usually makes minimum payments on his debt and he has been late with three payments in the last year. He wants to buy a new car but was told that his interest rate on a loan would be very high. What is the most likely reason this might be so?A. He already has a student loan outstandingB. Recent graduates are not allowed to have more than $25,000 in debt outstanding C. General interest rates are very lowD. Interest rates must be tied to the CPIE. His credit rating is poor which results in a higher interest rate E. His credit rating is poor which results in a higher interest rate
Opportunity cost refers toA. Money needed for major consumer purchases.B. Current interest rates.C. Evaluating different alternatives for financial decisions. D. The amount paid for taxes when a purchase is made.E. The trade-off of a decision. E. The trade-off of a decision.
If a $10,000 investment earns a 4 % annual return, what should its value be after one year? A. $100B. $10,000C. $400D. $10,400 E. $4,000 D. $10,400
If a $10,000 investment earns a 7% annual return, what should its value be after 6 years? A. $10,700B. $10,000C. $15,100D. $15,000 E. $15,007 E. $15,007
If Melinda Miller estimates that her $100 weekly grocery bill will increase at an annual inflation rate of 4%, what should her weekly grocery bill be in 3 years?A. $112.00B. $114.00C. $121.60 D. $112.49 E. $100.00 D. $112.49
Randy Hill wants to retire in 20 years with $1,000,000. If he can earn 10% per year on his investments, how much does he need to deposit each year to reach his goal? Round your answer to the nearest dollar.A. $17,460B. $25,000C. $5,727D. $18,000E. None of the above
If you begin saving $2,000 a year at 5% (from age 22 to age 30 or 9 years), what will these funds grow to in this time period?A. $30,500B. $2,000C. $11,970 D. $18,000 E. $22,053
If you want $1,000 three years from now and you earn 4 percent on your savings, how much do you need to deposit?A. $1,000B. $1,040C. $889 D. $1,030 E. $885
The main purposes of personal financial statements are toA. Maintain information about your financial activities.B. Provide data for preparing tax forms or applying for credit. C. Measure your progress toward financial goals.D. Report your current financial position.E. All of the above are correct
Which of the following are two personal financial statements that you create yourself? A. Personal balance sheet and cash flow statementB. Bank statement and a balance sheetC. Budget and credit card statementsD. Tax returnsE. Checkbook and budget
Items with monetary value are referred to as A. Variable expenses.B. Assets.C. Liabilities.D. Net worth. E. Income.
The amount you would have left if all assets were sold and all debts were paid in full is called your A. Total liabilities.B. Total income.C. Budgeted expenses.D. Net worth. E. Net assets.
The inability to pay debts when they are due because liabilities far exceed the value of assets is called A. Cash flow.B. Insolvency. C. Liabilities.D. Liquid assets. E. Net worth.
Which of the following situations describes a person who could be insolvent? A. Annual cash inflows $45,000; liabilities $50,000B. Assets $40,000; liabilities $55,000C. Assets $78,000; net worth $22,000D. Assets $56,000; annual expenses $60,000 E. Liabilities $45,000; net worth $6,000
A debt ratio of 0.5 indicatesA. For every dollar of net worth, debt equals $0.50.B. For every dollar of assets, monthly credit payments equal $0.50.C. For every dollar of take-home pay, monthly credit payments equal $0.50. D. For every dollar of debt, net worth equals $0.50.E. The balance on the mortgage = 50% of the value of the home.
Which of the following ratios shows the relationship between gross income and money saved? A. Current ratioB. Liquidity ratioC. Debt payments ratio D. Debt ratioE. Savings ratio
The money left over after paying for housing, food, and other necessities is called A. Discretionary income.B. Gross income.C. Take-home pay.D. Disposable income. E. Monthly savings.
A family with $100,000 in assets and $60,000 of liabilities would have a net worth of A. $40,000.B. $160,000. C. $100,000. D. $60,000. E. $20,000.
Patrick Guitman has a net worth of $145,000 and liabilities of $155,000. What are his total assets? A. $300,000B. $155,000 C. $200,000 D. $145,000 E. $10,000
Given the following information, calculate the debt ratio percentage:Liabilities = $25,000Liquid assets = $5,000Monthly credit payments = $800Monthly savings = $760Net worth = $75,000 Take-home pay = $2,300 Gross income = $3,500Monthly expenses = $2,050A. 33.33 percent B. 30.00 percent C. 3.00 percent D. 3.20 percent E. 8.20 percent
Rebecca Wilson budgeted $1,200 for housing and utilities in July. She actually spent $1,160. What is her budget variance?A. $60 deficitB. $40 surplusC. $1,160 deficit D. $1,160 surplus E. $40 deficit
A tax due on the purchase of gasoline is called a(n) A. Estate tax.B. Excise tax.C. Income tax.D. Real estate property tax. E. Inheritance tax.
You may be required to make estimated tax payments if A. You do not have interest income from savings.B. You receive a paycheck with taxes withheld.C. You have no pension payments.D. You are an independent contractor. E. You have no royalties.
Shannon is working on her federal income tax form and wants to determine if she should itemize her deductions. She has identified several possible deductions. Which of the following is an acceptable deduction?A. Miscellaneous expenses that exceed 2% of AGIB. $10,000 gift to her cousinC. Moving expenses for a new job that is 25 miles from her old home D. Medical and dental expenses less than 10% of AGIE. Credit card interest
When Paul completes his taxes, he can include all of the following as exemptions except A. His wife.B. His 20-year-old son who is working full-time and living in an apartment. C. His 22-year-old daughter who is a full-time student.D. Himself.E. His 12-year-old son.
The tax based on the total tax due divided by taxable income is called the A. AMT.B. Income tax rate. C. Average tax rate. D. Total tax rate.E. Marginal tax rate.
Sam and Diane are completing their federal income taxes for the year and have identified the amounts listed here. How much can they rightfully deduct?• AGI: $80,000• Medical and dental expenses: $9,000 • State income taxes: $3,500• Mortgage interest: $9,500• Charitable contributions: $1,000A. $57,000.B. $14,000.C. $20,000.D. $23,000.E. $15,000.
Using the following table, calculate the taxes for an individual with taxable income of $20,800. A. $2,695. B. $5,175. C. $20,800. D. $6,025. E. $850.
If Jack was in a 25% tax bracket and received a $1,000 tax deduction, by how much would his taxes be reduced?A. $50B. $500 C. $250 D. $1,000 E. $25
George Franklin paid taxes of $4,375 on a taxable income of $32,000. What was his average tax rate? A. 10%B. 28% C. 25% D. 13.7% E. 15%

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