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Ch 3 BUDGET -Financial Literacy Flashcards | StudBud
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Ch 3 BUDGET -Financial Literacy
Ch 3 BUDGET -Financial Literacy
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1
Which of the following statements is false?
A budget is a written plan for saving and spending.
A cash flow statement summarizes all of the income and exp over pd of time
A budget is meant to summarize the saving and spending that has taken place
The cash flow statement is reflective of what has already taken place.
2
A cash flow plan that assigns an expense to every $ of your income, wherein the income minus the total expenses = 0.
Zero-spending Plan
Zero-based budget
3
Eating out is a:
Variable Expense
Fixed Expense
Intermittent Expense
Discretionary Expense
4
Rent is a:
Discretionary Expense
Fixed expense
Intermittent expense
Variable Expense
5
Occurs when money is withdrawn from a bank account and the available balance goes below zero.
Overdraft
Reconcile
6
Having more than one bank account is never a good idea since it can complicate money management.
True
False
7
A debit card cannot be used for online purchases.
False
True
8
The following are guidelines for budgeting with an irregular income except:
Make a list of all of your expenses for the month ahead.
When your check comes in, spend your money all the way down the list.
Prioritize the list in order of importance
Budgeting with an irregular income is no different than with a regular inc
9
Percentage of Americans living paycheck to paycheck
25%
40%
50%
70%
10
A written budget, if followed, removes _________ from your finances.
Overspending
Management by crisis
Guilt
All of the Above
11
Expenses that remain the same from month to month.
FIXED
VARIABLE
12
Which of the following is a consequence of overdrawing your checking account?
Stress from money mismanagement
Bounced check fee
Overdraft Fee from your bank
All of the above
13
Car repairs are a:
Discretionary Expense
Variable Expense
Intermittent Expense
Fixed Expense
14
Online bill pay allows you to make payments to whomever you wish without having to write a check and send it in the mail
False
True
15
.An item that is bought without previous planning or consideration of the long-term effects.
Impulse Purchase
Sale Item
16
Which of the following is not a record-keeping feature you could expect from your bank?
Customer service reconciles your account for you
A reconciliation sheet
A monthly account statement
An account register
17
The number-one cause of divorce in North America today is stress and disagreements over money.
False
True
18
Which of the following account records would have the most current balance?
All of these records will have accurate account balances
Your own account register
Your monthly bank statement
Account balance statement from the ATM
19
Your own record of all you transactions:
Account Statement
Check Register
20
A summary of all the income and outgo over a certain time period.
Cash Flow Statement
Budget
21
Budgeting is crucial to your financial success.
False
True
22
Your monthly budget should include:
Fixed Expenses
Variable Expenses
Discretionary Expenses
All of the Above
23
The zero-based budget is the best method of budgeting because:
A zero-based budget allows less money for wants
Zerobased budget ensures every $ you make is assigned a specific purpose.
This type of budget is less complicated than other types of budgets
Sticking to a zero-based budget requires less discipline
24
To match your bank statement with your checkbook.
Cash Flow Plan
Reconcile
25
A written cash flow plan
Personal Finance
Budget
26
Series of envelopes that are divided into categories and are used to store cash for planned monthly expenses.
Envelope System
Check carbon
27
The envelope system works great for managing spending on things that don’t normally have a fixed monthly expense.
False
True
28
Which of the following is something that a typical millionaire would do?
Replace things that are not broken
Spend less than they make
Lease a new car
carry debt
29
Groceries are a:
Fixed Expense
Discretionary Expense
Variable Expense
Intermittent Expense
30
Doing a budget does not:
Make overspending more likely
Make your money go further
Show if you are overspending in an area
Remove guilt and shame sometimes associated with a purchase
31
Setting up automatic account transfers is the easiest way to build your savings for your emergency fund or large purchas
False
True
32
ʺPay yourself firstʺ means you should assign a portion of your income to saving and investing every month.
True
False
33
Writing and following a zero-based budget will help you avoid overspending and impulse purchases.
True
False
34
Non-essential expenses.
INTERMITTANT
DISCRETIONARY
35
If you write a zero-based budget every month, it is not necessary to reconcile your account.
True
False
