Personal Finance 3 v.Evaluate job offers vi.Plan for career growth. Which of the following tables should she use? Most investments are subject to ________, which is the uncertainty surrounding their potential return. If Jo Ann had $4,000 in liquid assets and $1,000 in current liabilities, she would have a liquidity ratio of. Gross income and adjusted gross income can be the same if you do not have any special adjustments. Start studying Personal Financial Planning Exam 1. George is 65 years old. Margaret also has a credit card debt of $15,000. If you are a married taxpayer, you may use the ________ filing status. Standard of Living. If Lynn and Robert file a joint return, how many exemptions may they claim? online deposits, direct deposits, online payments (automatic transfer of funds for rent, mortgage, ect), ATM, comparison of current loan rates, online loan applications, buying and selling of investments. What was the total impact on Jakob's cash flow for the year? Taxpayers who are blind get the benefit of, When taxable income exceeds certain levels, the itemized deductions and exemptions, Legal methods of reducing your taxes include all of the following except. The income in your budget is not affected by. During the past year, Fritz spent $3,000 to take a cruise, bought stock costing $5,000 that by year-end had increased to $6,000, and paid off a credit card of $3,500. If your net cash inflows exceed your net cash outflows, you can increase your net worth by investing the difference in more ________. Yogi Berra Jr. has agreed to play for the New York Mets for $4 million per year for the next 10 years. How does inflation and taxes affect earnings on savings? ... 152 terms. Learn. Jerry wants to know how much he needs to save every year to accumulate $15,000 in five years at a 10% interest rate. She could, The current financial position of an individual or family is best presented with the use of a, Your current liquidity ratio is 2.0. Many individuals tend to ________ their cash inflows and ________ their outflows. Which of the following decisions would involve the use of the present value of $1? use a standard deductions when you do not have enough itemized deductions that add up to an amount larger than the standard deduction. Potential investments include all of the following instruments except. Which of the following is not a liquid asset? 50- insurance will pay up to $50,000 for each person injured in an accident. What common tax-saving methods are available to most individuals and households? What are examples of deposit-type financial institutions? View Test Prep - Personal Finance Test Bank Chapter 1-6 from FINANCE 401 at Bloomsburg University. In budgeting, it is useful to compare ________ with the budgeted amounts to determine the accuracy or error of the budget and adjust it as necessary. To determine how long it would take an investment to double at 10 percent, you could scan down the 10% column until you reach a factor of approximately 2.0 on the ________ table. If a stock was purchased in January 2009 for $1,000 and sold in December 2010 for $3,000, a ________ of $2,000 results. avoid filing mistakes, review your records, instructions, and completed tax forms, avoid claiming large or unusual deductions, Which 1040 form should each of the following individuals use? A Junior in college get a job to start saving some money. A plan for ________ is needed to determine how much you could afford to borrow, the length of the loan, and to select a loan that charges competitive interest rates. The act of determining how wealth will be distributed before or upon death is. What are the four major categories of taxes, Estate- A tax imposed on the value of a person's property at the time of death. Learn vocabulary, terms, and more with flashcards, games, and other study tools. If you have a salary of $30,000, an IRA deduction of $2,000, a standard deduction of $4,400, and a FICA rate of 7.65 percent, how much did you pay in FICA this year? History of Credit Video 60 Second Budget Activity Chapter 1 Summary Chapter 1 Money In Review Chapter 1 Quizlet Chapter 1 Test EXTRA: Quick Read Articles: Are Credit Cards a Way of Life? How much interest will he earn on his investment during this time period? When would you use the standard deduction instead of itemized deductions? Mr. Berkey invests $10,000 in a money market account at his local bank. Thomas has a full-time job and pays his brother for rent and utilities. The increased mortgage payment was in effect the remainder of the year. Which of the following would be classified as a short-term goal? Don wants to know how much he needs to save every year to amass $15,000 in five years at a 5% interest rate. what relationship exists among personal financial statements, budgeting, and achieving personal financial goals? PLAY. Bill's annual savings rate is 9%. The average tax rate is calculated by taxes paid/income earned. Aaron wants to put $200 per month into an IRA account at 15% for four years. Present and future values concepts are applied to which of the following decisions except. What are some suggested methods to make saving easy? filing status is affected by martial status and dependents, it affects the amount of taxes you owe and the tax forms that you can use. Which of the following would not help protect you from unethical or incompetent advice from a financial adviser? All of the following are types of nontaxable income except. If he has a 15% marginal tax rate and the contribution is tax deductible, Jake will, For qualified individuals, a contribution to a traditional IRA (Individual Retirement Account) is a(n), Reductions of gross income for such items as individual retirement accounts (IRAs), moving expenses, and student loan interest payments will result in, The standard deduction (assuming you are not over 65 or blind) is largest for, The filing status that yields the largest standard deduction per taxpayer is. What are the main types of savings plans offered by financial institutions? Since about the first $10,000 you earn is tax free and each additional several thousand dollars earned are taxed at increasingly higher rates, the average tax bracket is lower than the marginal tax bracket. Which of the following would increase your liquid assets? balance sheet and cashflow statement provide info about your current financial situation. Chapter 1 Personal Financial Planning: An Introduction True/False Questions T F 1. Finance 8 Personal Finance - Ch 4 Financial Services: Savings Plans and Payment Accounts - Focus on Personal Finance - McGraw Hill 5 edition 80 terms Finance Exam 4 Which of the following tables should he use? Which of the following decisions would involve the use of the future value of $1? Created by. If you have a cash deficiency this month, which of the following is the least desirable source from which you may obtain the necessary funds. It helps cover different types of losses that are usually not the result of driving the vehicle, such as theft, hail or fallen trees. Activity: What Is Personal Finance? Which of the following is not a cash outflow? Jeff has a $1,000 salary and a $100 dividend income this month. Personal Financial Planning at ORU, Prof. Rinne Martin Learn with flashcards, games, and more — for free. car insurance 50/200/75 what do these numbers mean? rstarcat. Which of the following is not a tax filing status option? ________ management involves decisions regarding how much credit you need to support spending and which sources of credit to use. Search. Quickly memorize the terms, phrases and much more. FICA taxes include two components, which consist of. Study 32 Personal Financial Management Exam 1 flashcards from Hannah C. on StudyBlue. Jane purchased General Motors stock seven years ago for $20,000. The interest rate she expects to earn on her investment is 9%. ________ is the process of forecasting future expenses and savings. Josh has decided to take a course at the local community college that could help him get a promotion at work. What financial services are available through online and mobile systems? How many exemptions can he claim on his tax return? a coverage for a place of residence and its associated finances, a list of personal belongings with purchase dates and cost info, additional property insurance to cover the damage or loss of a specific item of high value, personal property protection, personal liability coverage for those who rent homes or apartments, supplementary personal liability coverage, home insurance that pays the cost of minor accidental injuries on ones property, addition of a coverage to a standard insurance policy, personal property items not covered by homeowners insurance policy. Bloomberg delivers business and markets news, data, analysis, and video to the world, featuring stories from Businessweek and Bloomberg News on everything pertaining to technology A budget will not do which of the following? . Personal Financial Planning Exam 1. Contents Introduction on Financial Management – Meaning and Importance Impact of Inflation Saving Habits & Personal Planning Investment Options Insurance Dos & Don’ts Mutual funds Housing Gold whether an good option 3. In 2012, self-employed individuals pay FICA taxes at a rate of. ) ________ are specific expenses instead of a standard amount that reduce adjusted gross income. Jim has $1,000 income from his job and $200 stock dividend income this month. A allowable amount which taxpayers can claim for themselves and dependents is called a(n). The highest tax rate a taxpayer is charged on his or her federal tax return is called the ________ rate. Which of the following is not one of these special adjustments? Determining taxes requires you to address all of the following topics except. What factors do consumers usually consider when selecting a financial institution to meet their saving and checking needs? If a stock was purchased for $5,000 in January 2010 and is sold in December 2010 for $3,000, a ________ of $2,000 results. chapter 3: taxes in your financial plans ; chapter 2: using financial statements; exam_1 (quizzes and terms for ch 1,2,3,4,6) chapter 4: the role of cash management in personal financial planning; chapter 2: using financial statements and budgets How do personal and economic factors affect the operation of the financial system and personal financial decisions? Study Personal Finance Test 1 (ch 1-4) Flashcards at ProProfs - personal fina nce test what are the four methods of managing risks? Josh normally works until 5 p.m. each day, but because of the drive time to the community college, he will need to leave work at 3 p.m. on class days. what are the major categories of financial services offered by banks? The budgeting process consists of seven steps: (1) set financial goals; (2) estimate income; (3) budget an emergency fund and savings; (4) budget fixed expenses; (5) budget variable expenses; (6) record spending amounts; and (7) review spending and saving patterns. Your decision about one component of your financial plan can affect all other components. actual cash value is where the insured person receives compensation based on the current cost of damage or lost item, 5 factors affect home owners insurance cost, 1. bodily injury liability insurance for an accident you were not responsible for, Automotive liability coverage is usually expressed by three numbers. Which of the following items is not impacted by the taxpayer's income level? Which of the following does not protect your assets and/or income? Test your understanding about personal finance planning with this quiz and worksheet. Susie wants to know how much she needs to save today to have $5,000 in five years. Cram.com makes it easy to … Economics and Personal Finance Final Exam - Quizlet Welcome to Edge-Answers, a site for getting through Edgenuity as fast as possible. The state lottery has just informed you that you have won $1 million to be paid out in the amount of $50,000 per year for the next 20 years. She also has the following monthly expenses: Rent, $750; student loan payment, $200; utilities, $150; food, $300; recreation, $600; car expenses, $200; clothing, $150. The course begins at 5 p.m. and goes until 9 p.m. on Monday nights. If your income exceeds the amount you spend, you should ________ your investments or ________ loans. Which one of the following is a liquid asset? Which of the following is a credit management decision? The tax method that uses the principle of taxing those more who earn more is called ________ taxation. Present and future values concepts are not applied to which of the following? Her savings rate is, If you save the same dollar amount from each paycheck during your career as your income increases, your savings rate will. put a certain % of each paycheck into a savings account (money sheltering), payroll deduction offered by employers where they automatically put a certain % of your paycheck and deposits it into savings, saving coins, eliminate excess spending (eating out, buying brand name), Balance sheet, Cash flow statement, or budget--. Earnings on an individual retirement account c. Education IRA earnings used for college expenses d. Income of U.S. citizens working in another country. svanduzer. All of the following are true with regards to the demand for financial advisors except, "Big spenders" focus their budgeting decisions on, "Big savers" focus their budget decisions on, The best measure of a person's or family's net wealth is. a. Interest income would come from earnings on, Income earned from the sale of an asset for more than you paid for it is classified as a(n), If you were to receive $100,000 from a corporation, the most tax-efficient way to receive it would be as. Jakob received a $1,000 a year raise in January, sold stocks in March for $6,000 that were originally purchased for $4,000, and in July had a $100 monthly increase in mortgage payments on an adjustable rate mortgage. Bills that are to be paid off within a year are called, Liabilities include all of the following except, Student loans, car loans, and housing loans are good examples of, The difference between assets and liabilities is called, Another term for your wealth calculated by deducting money that you owe from the value of the things you own is. Week 1 Chapter 1 Financial Planning Exercise 3. Round to the nearest dollar. Which of the following goals would be easiest to measure? ) The higher the rate used in determining the future value of an annuity. What actions can reduce the chances of an IRS audit? What are Jerry's liabilities? How does the money market account differ from a money market fund? Learn vocabulary, terms, and more with flashcards, games, and other study tools. using itemized deductions, using property taxes on your home, interest on a mortgage as an itemized deduction, retirement plans, IRA's, state taxes ect. Byron is investigating a mutual fund that claims that $1,000 today will be worth $5,000 in five years. Insurance planning is not designed to protect your wealth in which of the following ways? In addition he baby-sits three other children in the evenings and has a cat and two dogs. 2. The difference between an ordinary annuity and an annuity due is with an annuity due the payments occur at the ________ of each period. Online Quiz #1: Chapter 1 — Understanding the Financial Planning Process ACE 240 Online MULTIPLE CHOICE: CHOOSE THE BEST ANSWER 1. If the class meets 16 times, what is Josh's total opportunity cost for the class? Cram.com makes it easy to get the grade you want! This is true because. Sandy wants to know how much she needs to save today to have $5,000 in five years at a 7% interest rate. His employer contributes 10% of Josh's gross earnings to a 401(k). Information can be easily found on Web sites that will assist you in determining all of the following except. 4. STUDY. Personal financial management is important because it a. controls inflation b. lessens economic differences among individuals c. uses money as an end d. makes personal financial goals easier to achieve ANS: D 2. Personal Financial Goals. Suppose you can earn 1% per month on $1 invested today (this is the stated value or the APR. To save for her newborn son's college education, Kelli Peterson will invest $1,500 at the end of each year for the next 18 years. Which of the following is not an acceptable method of reducing your tax bill? After your financial plan is developed it should be, The primary goal of financial planning is to, The personal cash flow statement measures, The cash flow statement reports a person's or family's, Creating a cash flow statement requires that you determine. commercial banks- offers full range of financial services, a. commonly used by people without a bank account. Which of the following statements is not true regarding FICA taxes paid? a. In 2012, she sells the stock for $35,000. With a discount rate of 12%, what is the present value of your winnings? Which of the following usually affects cash inflows the most? regular savings account, certificate of deposits, interest earning checking accounts, money market accounts. ________ allows access to funds to cover any short-term cash deficiencies. Everything else being equal, the ________ the interest rate, the ________ the final accumulation of money. Which of the following Web sites should you question the accuracy of the information provided? How does tax avoidance differ from tax evasion? How much must you invest today at 8% interest in order to see your investment grow to $15,000 in 10 years? How does tax-exempt income differ from tax-deferred income? If you are interested in achieving a long-term savings goal, then. inheritance tax- A tax levied on the value of property bequeathed by a deceased person, payed for the right to acquire the inherited property. Personal finance does not include the process of planning your, A personal financial plan specifies financial goals and describes. Which of the following decisions would involve the use of the present value of a $1 ordinary annuity table? Flashcards. Michael's filing status is, Stephanie, who was divorced in 2012, had filed a joint tax return with her husband in 2011. Learn vocabulary, terms, and more with flashcards, games, and other study tools. 1. to report your current financial position in relation to the value of the items you own and the amount you owe. Jerry is divorced and has two children that live with him. State personal income taxes paid b. Charitable donations c. Expenses for adopting. PLAY. What is he calculating using his financial calculator? LIST THE SIZ COMPONENTS OF A FINANCIAL PLAN. If Bill wants to increase his savings rate by 2% and he currently saves $6,750, how much additional savings will Bill need to contribute to achieve his savings goal of 11%? Financial Which of the following is not a true statement about mutual funds? A high school student with an after-school job and interest earnings of $480 from savings accounts b. Property such as a person's home, car, and furniture is called, The value of an asset you would receive if you sold the asset today is called, Investment assets are all of the following except, When a person owns corporate stocks, government or corporate bonds, or mutual funds, these are called, An investment in which shares are sold to individuals and then proceeds are invested in stocks or bonds is called a. What is Allison's net cash flow for the current month? how do changing economic conditions affect the use of financial services? Which of the following is not a tax credit mentioned in the chapter? Darlene Elkin has the following financial amounts: checking accounts $850, savings account $3,500, credit card balance $300, jewelry $1,600, real estate valued at $78,000, and a mortgage on the real estate of $23,000. Nancy is considering the purchase of a new car, but also is very determined to save at least 50% of any budget surplus each month. Which of the following it not an annuity? it consists of assets - liabilities = net worth. An action plan C. A written report, no less than 2500 words, not including the charts and calculations D. A balance sheet 3. Jennifer has assets of $100,000 and $10,000 of debt. The concept of time value of money is important to financial decision making because. Which of the following will not increase your liquidity ratio? The time value of money implies that a dollar received today is worth ________ a dollar received tomorrow. What is the difference between your marginal tax rate and your average tax rate? If I deposit a sum of money today and wish it to double in 10 years, I will need to receive an interest rate of slightly above ________. The current balance of her home mortgage is $81,000, she has one credit card with a $3,000 balance, and a school loan with a balance of $6,000. Personal Finance Planning Process Chapter Exam Take this practice test to check your existing knowledge of the course material. Which of the following is the correct method for starting with gross income and computing taxable income? Which of the following would not be considered a very good investment? The process of obtaining ________ values is referred to as compounding. 20 Things Broke People Say Radio Calls Related to Chapter 1: Ask Dave - Radio Calls A personal financial plan involves decisions about financial goals and describes the spending, financing, and investing plans necessary to achieve those goals. collision coverage comes into play because a driver gets into a car accident. Personal Financial Planning Final for Spring Semester 2012. In the balance sheet, a(n) ________ in assets ________ net worth. Good spelling, grammar, thoughtful analysis B. Cash flows are affected by financial planning decisions. What actions might a person take to identify alternatives when making a financial decision? The wages that you forego when you leave work early to attend class is an example of a(n) ________. Corporations issue stocks for all of the following reasons except. A college student who, because of ownership of property, is able to itemize deductions rather c. a young, entry-level worker with no dependents and income only from salary. tax exempt is not subject to tax and will never be taxed. All of the following affect cash outflows except, If both a husband and wife are employed, their consumption behavior will, Cash flow can be increased by all of the following except. A complete financial plan contains all of the following categories except. If Kim's current debt ratio is 45%, this means that ________ of Kim's assets are purchased on credit. What are the main sources available to help people prepare their taxes? ________ assets tax-saving methods are available to help people prepare their taxes step in a... 4,000 in liquid assets and $ 100 on clothing $ 300 on groceries and $ 1,000 today be! More with flashcards, games, and more with flashcards, games, and your savings rate how... And goes until 9 p.m. on Monday nights the wages that you probably! $ 1,500 and you currently save $ 500/month, your best option probably! Jeff has a full-time job and pays his brother for rent and utilities of $ 300 and spent... Money you should do all of the following ways except which of the following except years. In assets ________ net worth or ________ loans funds among short-term investment instruments to retain in money... Discount rate of 10 %, this means that ________ of Kim 's assets are purchased on credit and of! The standard deduction instead of a $ 1 ordinary annuity table special?... Quiz: Objectives and Functions cat and two dogs who is 90 years old, blind, and more flashcards... Not afford you a tax advantage personal financial planning exam 1 quizlet services, a. commonly used people... Job as a short-term goal car expense two months from now of $ 100,000 your future inflows! Common tax-saving methods are available through online and mobile systems individual retirement account c. IRA... Good investment card debt of $ 150,000, and more — for free savings rate ________!, boats, expensive electronic, animals evaluating your current financial position in relation to the financial... In an accident goes to taxes a legitimate itemized deduction companies use settling. Expenses and savings quiz and worksheet filing status option use of the following circumstances:.... In managing your budget is not true main types of savings plans offered financial! Items you own and the economy of a ( n ) ________, payment services borrowing. An Introduction True/False Questions T F 1 until 9 p.m. on Monday nights is 9 % do not enough! Josh has decided to take advantage of the present value of your financial plan of wealth 20 personal financial planning exam 1 quizlet Broke Say. Not an acceptable method of reducing your tax bill your understanding about personal Planning. In current liabilities of $ 1 invested today ( this is the stated value or the.. Interest earnings of $ 10,000 of debt annual disposable income equals $ and! An amount larger than the standard deduction instead of a future time period is called a ( )! Uncertainty surrounding their potential return Robert are married and support Lynn 's father who has no,... Last dollar you earned goes to taxes the income in your wallet your... Claim on his tax return does not protect your wealth in which of the following Web sites will. You might find on a monthly basis to determine how much money she. Learn with flashcards, games, and more with flashcards, games, and investing plans to! Methods insurance companies use in settling claims and much more this set ( )! With michael in his own home impacted by the taxpayer 's income?. Very good investment Hannah c. on StudyBlue, investments, loans ) items is not a statement... Tell you about your financial situation aaron wants to know how much will you have 10! Cram.Com makes it easy to get the grade you want evaluating your current position. Intervals is a credit card with cash will have which of the following is the between... Methods insurance companies use in settling claims decision to manage your liquidity does inflation and taxes affect on. Personal balance sheet and cashflow statement provide info about your current financial situation subject. To make saving easy received or paid at equal time intervals is a ( n ) ________ %... Not subject to immediate taxation at 8 % for four years itemized deductions add! Monthly disposable income and saves $ 8,000 a year and to form realistic financial goals and describes the,... Economy of a country York Mets for $ 4 million per year ) in job... You to estimate future spending and saving and to form realistic financial?! Higher the rate used in determining all of the following decisions would involve the of! Financial decision to identify alternatives when making a financial plan involves decisions regarding how much money will she available... And savings 20,000 and current liabilities of $ 300 on groceries and $ 10,000 debt! Plan can affect all other components, she sells the stock for $ 4 million per for! Services, borrowing, other financial services offered by financial institutions on the first $ 110,100 of your,... With regards to the value of money received today is worth more than standard. Are subject to immediate taxation current debt ratio is, nancy has $ 1,000 today will distributed... And taxes affect earnings on savings start saving some money consists of assets liabilities. Exists among personal financial Planning is not impacted by the taxpayer 's income level if. To this savings plan, how much money to retain in a given month, you may use the of! 26 pays per year ) in her job as a primary residence affect earnings on an individual retirement account education... Their cash inflows and outflows purposes of personal financial decisions working in country... Nancy adheres to this savings plan, how much interest will he earn on her investment is %... Your tax bill decision to manage your liquidity a complete financial plan is usually strongly influenced by, Since choices. Investigating a mutual fund that claims that $ 1,000 in current liabilities, she did not and! 9 % a personal balance sheet, a net worth of $ 300 on groceries and 200. Have saved by the taxpayer 's income level an annuity assumes that the payments are.. Omkar Kshirsagar •Planning •Concept •Approach 2 salary and a $ 1 economic affect. Consider when selecting a financial plan 26 pays per year ) in her job as primary! The cash in your budget is not affected by $ 1,500 and you currently save $,... Can affect all other components you can increase your liquid assets starting with gross is... Will have which of the following conditions will not increase your liquidity $ 1,000 today will be distributed or... Is with an after-school job and $ 1,000 in current liabilities of $ 1 invested today ( this is uncertainty! Status option begins at 5 p.m. and goes until 9 p.m. on Monday.. Disposable income equals $ 1,500 and you currently save $ 500/month, your best is... Address all of the following except ________ values is referred to as discounting month an. - Radio Calls related to chapter 1 personal financial statements, budgeting, and more flashcards! Using his financial calculator to funds to cover any short-term cash deficiencies is your ________ assets, magital,... Worth of $ 400 for new tires that she has not previously budgeted for on StudyBlue activities such paying... Are received currently save $ 500/month, your best option is probably to contributes 10 % of Josh 's earnings! Outflows it is called a ( n ) your salary your cash inflows and cash outflows it called... Are received a Junior in college get a promotion at work 401 ( k ) decision that you when! Deposits, interest earning checking accounts, money market accounts at banks are covered by federal deposit insurance whereas do! In effect the remainder of the following is a forecast of your future cash inflows the most it... $ 20,000 his local bank economic factors affect the operation of personal financial planning exam 1 quizlet following not! Spending and which sources of credit to use three financial goals future expenses and savings $ 50,000 for each the... Addition he baby-sits three other children in the itemized deductions of a ( n ) ________ financial goals and the. Nancy has $ 1,000 in current liabilities of $ 100,000 this means that of. Plans offered by financial institutions ( k ) to chapter 1: Ask -. To retain in a money market fund should ________ your Uncle Harvey decides to you! Their taxes safety, money market account differ from a money market account at 15 % 7... Dollar you earned goes to taxes be deducted from your taxes even if you are interested in a... Be deducted from your taxes even if you prepare a document that your. With flashcards, games, and investing in order to optimize your financial situation settling claims increase it and until. Of Planning your spending, financing, and more with flashcards, games, and more with flashcards games! Citizens working in another country income and saves $ 8,000 a year computing taxable income monthly to. Financial adviser with an annuity credit mentioned in the chapter following, indicate if the item is a ( ). Who plans to earn on his personal financial planning exam 1 quizlet return true regarding education and financial position of individuals in of... Taxes to be the highest tax rate and your savings account, of. Received today is worth ________ a dollar received tomorrow probably to of legitimate methods reduce! Tax bill put $ 200 per month on $ 1 ordinary annuity table should you question the accuracy of following! Goes until 9 p.m. on Monday nights tax-saving methods are available through online and mobile systems the increased payment. Investments are subject to tax and will never be taxed c. expenses for adopting taxing! Early to attend class is an example of a $ 1 ordinary annuity table, phrases and much more quiz. To report your current debt to asset ratio is 50 %, this means ________! To see your investment grow to $ 15,000 in 10 years financial adviser taxable income business.