Fin 150 ch. 2

Shows your total equity or net worth

Consumer equity form

Which is a reason why people avoid making a budget? a. Fear of what they may find b. A budget has been used to abuse them c. They never had a budget that really worked d. All of the above

D

Which of the following is not true of a zero-based budget? a. You spend every dollar on paper before the month begins b. The money you spend should equal the money you earn c. Use envelopes for categories in which you tend to overspend d. If you have extra money left at the end of the month, your budget was successful

D

Which term is not associated with balancing a checking account? a. Reconcile b. Deposit c. Withdrawal d. Loan

D

If you are struggling financially and are behind on your bills, what should you budget first? a. New clothes b. Spring break trip c. Food d. Credit card payment

C

In order to effectively manage money, you need a: a. Credit card b. Car loan c. Budget d. All of the above

C

On average, how long will it take before your budget begins to work effectively? a. One month b. Two months c. Three months d. Six months

C

How often should you balance your checking account? a. once a month b. once a quarter c. once a year d. You do not need to balance your checking account if you have online banking

A

Must have the money in the bank in order to use

ATM/debit card

What is used when you do not have a predictable monthly income? a. Lump Sum Planning Form b. Irregular Income Form c. Budget d. ATM/Debit Card

B

When using a bank statement to balance a checking account you: a. Compare your check register with the bank statement side by side. b. Compare each transaction and make check marks on both lists. c. List any debits or deposits that are present in the register, but not present in the bank statement and calculate those into your bank statement. d. Compare your register balance to the statement balance. e. All of the above.

E

A zero-based budget is only used for people who have zero debt. True False

F

Once you set up your budget, you fill each envelope with the money allotted to the categories listed on your budget. When the money in each envelope is gone, it is okay to pull more money out of the bank or use a debit card to supplement. True False

F

Used when you don't have a predictable monthly income

Irregular income form

Another name for a budget is a cash flow plan. True False

T

Each year, individual tax forms are due on April 15. True False

T

It usually takes three months for your budget to begin working well. True False

T

There are no interest fees charged on debit card purchases. True False

T

With cash, you can manage your funds by creating a zero-based budget. True False

T

A sign of crisis living

bounced check

Shows how your savings account is dispersed among saving goals

breakdown of savings form

Cash flow plan

budget

Envelopes used to pay cash for planned monthly expenses

envelope system

Buying without thinking about the future consequences

impulse purchase

Used to help plan for annual expenses

lump sum planning form

Fee for an overdrawn account

non-sufficient

Checking your bank statement against your account register

reconcile

A type of budget in which the expenses equals the income

zero-based budget

Many Americans have a _______ savings rate, meaning they spend more than they make. a. Negative b. Positive c. Neutral

A