BUS 146 Test 1
Money is
A medium of exchange
Employee benefits may include
all of the above
The standard deduction is a blanket deduction that depends on the taxpayers
all of the above
your income is directly related to your
all of these
The balance sheet describes a family's wealth
at a certain point in time
In order to minimize the difficulty associated with meeting monthly loan payments, the debt service ratio should be
below 35%
Your _______ is an example of a liquid asset.
checking account
The three key groups in the economic environment are
government, consumers, and businesses
Which of the following is NOT one of the three basic categories for individual income?
gross income
The federal governments gets the majority of its revenue from the ______ tax
income
The income statement includes
income, expenditures, surplus, or deficit
The three parts of your balance sheet are
income, liabilities, net worth
Using balance sheet information, the ____ ratio indicates your ability to meet current debt payments
liquidity
Tax planning is most commonly done to
minimize taxes
The main purpose of a budget is to
monitor and control financial outcomes
_______ would not be a long term financial goal.
paying your phone bill
The Federal Income Tax is
progressive
The amount of goods and services each dollar buys at any given point in time is
purchasing power
Family financial goals should be
realistically attainable
The last step in the financial planning process is to
redefine goals and revise plans and strategies as personal circumstances change
Inflation refers to
rising prices
The four stages of an economic cycle would not include
stagnation
If you do not wish to itemize deductions, you can use the
standard deduction
A progressive tax system is one in which higher-income people pay ________ than lower-income people.
tax at a higher rate
Kim's net worth is $85,000 and her total assets are $100,000. What is Kim's solvency ratio?
85%
Michael and Sandy purchased a home for $100,000 five years ago. It appreciated 6% annually, what is it worth today?
$133,800
Elena purchased a stamp collection for $5,000 thirty years ago. If it appreciated 8% annually, what is it worth today?
$50,315
You made an error when you filed your tax return last year. You can correct this error by filing Form
1040X
Mindy and Lou had liquid assets of $10,000 and current debts of $30,000. What is their liquidity ratio?
33%
Jacque's total monthly loan payments are $1,020 while her gross income is $3,000 per month. What is her debt service ratio?
34%