Bus 121-01 Ch. 2 Money Management Skills
During the past month, Jennifer Johnson had an income of $3660 but had to use some of her liquid savings to cover her monthly expenses. This resulted in a decrease in net worth of $440. This means Jennifer's monthly expenses for the month were:
$4100.
Darlene Wilson has the following financial amounts: checking account balance $1120, savings account $4250, credit card balance $1830, jewelry $1930, current market value of home $111,000, a mortgage on the home of $83,250. What is the total value of Darlene's assets?
118,300 Total assets = liquid assets + real estate assets + personal possession assets = (1120 + 4250) + 111,000 + 1930 = 118,300
Rebecca Wilson's monthly budget had planned spending of $383 for a new wardrobe in June. She actually spent $420. What is her budget variance?
$37 Deficit Deficit occurs where actual spending is greater than planned spending.
Given the following information, calculate the net worth: Assets = $7400 Cash inflows = $6800 Cash outflows = $4400 Liabilities = $3300
$4100 Assets − Liabilities = Net worth; therefore, $7400 − $3300 = $4100.
Given the following information, calculate debt payments ratio percentage. (Round your answer to 2 decimal places.) Liabilities = $41,500 Liquid assets = $8300 Monthly credit payments = $1650 Monthly savings = $1270 Net worth = $98,000 Current liabilities = $3300 Take-home pay = $4000 Gross income = $8600 Monthly expenses = $5440
41.25% Debt payments ratio = Monthly credit payments/Take-home pay = $1650/$4000 = $0.4125 = 41.25%.
The saving component of financial planning focuses on long-term security and includes
A regular savings plan for emergencies.
Which of the following situations describes a person who could be insolvent?
Assets $40,600; liabilities $46,700
To develop financial goals, one should
Identify specific, realistic goals that are measurable along with a time frame and an action plan.
The goal of investing $50 per month for the next 12 years for your nephew's college fund is a(n) ________ goal.
Long-term
Which of the following would increase the interest rate for a loan?
Poor credit rating.