Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
58. (p. 81-82) Patricia McDonald has determined that the value of her liquid assets is $4,500, the
value of her real estate is $128,000, the value of her personal possessions is $62,000, and the
value of her investment assets is $73,000. She has also determined the value of her current
liabilities is $7,500 and the value of her long term liabilities is $98,000. What is Patricia’s net
worth?
59. (p. 82-83) Patricia McDonald has determined the following information about her own
financial situation. Her checking account is worth $850 and her savings account is worth
$1,200. She owns her own home that has a market value of $98,000. She has furniture and
appliances worth $12,000 and a home computer and laptop worth $3,300. She has a car worth
$12,500 and owes $7,800 on her auto loan. She has also purchased some stock worth $5,500
and she has a retirement account worth $38,550. What is the total value of her assets?
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
60. (p. 82) Kathy Stumbaugh has determined that the value of her assets is $46,000 and the
value of her debts is $32,000. The difference between these two is $14,000. The $14,000
could be referred to as her:
61. (p. 82) A family has a net worth of $156,000 and liabilities of $167,000, what is the amount
of their assets?
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
62. (p. 80) Sean Carter needs to store monthly statements from his bank, his credit card
company and from his savings and loan. Where is the most appropriate place for Sean to store
this information?
63. (p. 80) Jerry Allison needs to store the title to his car and his house. Where is the most
appropriate place for Jerry to store this information?
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
64. (p. 83) Katherine Kocher has determined the following information about her own financial
situation. Her checking account is worth $850 and her savings account is worth $1,200. She
owns her own home that has a market value of $98,000. She has furniture and appliances
worth $12,000 and a home computer and laptop worth $3,300. She has a car worth $12,500.
She has recently purchased a 2-year certificate of deposit worth $5,500 and she has a
retirement account worth $38,550. What is the value of her liquid assets?
65. (p. 83) Katherine Kocher has determined the following information about her own financial
situation. Her checking account is worth $850 and her savings account is worth $1,200. She
owns her own home that has a market value of $98,000. She has furniture and appliances
worth $12,000 and a home computer and laptop worth $3,300. She has a car worth $12,500.
She has recently purchased a 2-year certificate of deposit worth $5,500 and she has a
retirement account worth $38,550. What is the value of her real estate assets?
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
66. (p. 83) Katherine Kocher has determined the following information about her own financial
situation. Her checking account is worth $850 and her savings account is worth $1,200. She
owns her own home that has a market value of $98,000. She has furniture and appliances
worth $12,000 and a home computer and laptop worth $3,300. She has a car worth $12,500.
She has recently purchased a 2-year certificate of deposit worth $5,500 and she has a
retirement account worth $38,550. What is the value of her personal assets?
67. (p. 84) Katherine Kocher has determined the following information about her own financial
situation. Her checking account is worth $850 and her savings account is worth $1,200. She
owns her own home that has a market value of $98,000. She has furniture and appliances
worth $12,000 and a home computer and laptop worth $3,300. She has a car worth $12,500.
She has recently purchased a 2-year certificate of deposit worth $5,500 and she has a
retirement account worth $38,550. What is the value of her investment assets?
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
68. (p. 83-84) Katherine Kocher has determined the following information about her own
financial situation. Her checking account is worth $850 and her savings account is worth
$1,200. She owns her own home that has a market value of $98,000. She has furniture and
appliances worth $12,000 and a home computer and laptop worth $3,300. She has a car worth
$12,500. She has recently purchased a 2-year certificate of deposit worth $5,500 and she has a
retirement account worth $38,550. What is the total value of her assets?
69. (p. 83-84) Jamie McFarland has determined that the value of her liquid assets is $4,500, the
value of her real estate is $128,000, the value of her personal possessions is $62,000, and the
value of her investment assets is $73,000. She has also determined the value of her current
liabilities is $7,500 and the value of her long term liabilities is $98,000. What is the total
value of her assets?
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
70. (p. 84) Jamie McFarland has determined that the value of her liquid assets is $4,500, the
value of her real estate is $128,000, the value of her personal possessions is $62,000, and the
value of her investment assets is $73,000. She has also determined the value of her current
liabilities is $7,500 and the value of her long term liabilities is $98,000. What is the total
value of her debts?
71. (p. 82) Jamie McFarland has determined that the value of her liquid assets is $4,500, the
value of her real estate is $108,000, the value of her personal possessions is $62,000 and the
value of her investment assets is $73,000. She has also determined the value of her current
liabilities is $9,500 and the value of her long term liabilities is $68,000. What is Jamie’s net
worth?
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
72. (p. 85) This month, Ken Grossman has cash inflows of $3,100 and cash outflows of $2,950,
resulting in a
73. (p. 87) A person has $1,250 in liabilities, monthly savings of $200, and monthly gross
income of $2,500. What is the person’s savings ratio?
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
74. (p. 92) When preparing her monthly budget, Marge Kent has a total spending allowance of
$4,600. Each month she pays $1,200 in rent, $60 for cable television and Internet service, and
$240 for her auto loan. What percentage of her budget goes for these fixed expenses?
75. (p. 93) The Hernandez family budgets $420 a month for food. Last month they spent $413,
which creates a
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
76. (p. 96) Samuel Jackson has developed a budget that he follows each month. This is a budget
that he keeps in his head. He does not write anything down, nor does he use a computer to
keep track of this budget. What type of budget has Samuel created?
77. (p. 96) Jonathan Wynn has developed a budget that he follows each month. Jonathan has an
envelope for each type of expenditure. After he cashes his paycheck, he puts the amount of
cash in each envelope that he plans to spend on that category each month. What type of
budget has Jonathan created?
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
78. (p. 96) Amy Farmer has developed a budget that she follows each month. She went to the
office supply store and purchased a spiral notebook. Each month she pens in what she wants
to spend in the various categories. At the end of the month, she pens the amount that she
actually spent in each of these categories and compares the results. What type of budget has
Amy created?
79. (p. 96) Jeff Willis has a budget that he follows each month. He has used Microsoft’s Money
to help him determine what he wants to spend each month. At the end of the month, Money
automatically compares what he budgeted with what he spent. Jeff can also graph these results
if he wants to. What type of budget has Jeff created?
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
80. (p. 97-98) An investment account that increases from $1,000 to $1,005 in a month is earning
approximately __ percent annual interest.
81. (p. 97-98) An investment account that increases from $3,000 to $3,271 in one year is earning
approximately ___ percent annual interest.
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
82. (p. 85, 87) Allen Arnold has determined that the amount of money he spends on his mortgage
payment, car insurance payment, and cable bill totals $1,200 each month. What type of
expenses has Allen determined with this calculation?
83. (p. 81) Which of the following is (are) typically considered to be a personal financial
record?
84. (p. 80) Most income tax documents should be kept for _____ year(s).
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
85. (p. 84) Which of the following would most likely be classified as a current liability?
86. (p. 87-88) Which of the following would be considered a fixed expense?
87. (p. 78) Your Aunt gives you some money for your birthday and you decide to put it into
your savings account instead of spending it. The trade-off of not being able to spend the
money now is this decision’s ________ cost.
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
88. (p. 85) For January, Bethany DeWeese had cash inflows of $4,200 and cash outflows of
$4,750, resulting in a
89. (p. 81-82) What types of financial records and documents should be kept in a safe deposit
box?
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
90. (p. 82-88) What are the main components of a personal balance sheet and a cash flow
statement? What is the main purpose of each of these personal financial statements?
91. (p. 88-89) Diane Rossiter lives with her two sons, ages 6 and 9. They have had difficulty
managing their finances. What purposes could a budget serve for the Rossiters? What actions
would you suggest for the budgeting process to be successful?
Chapter 03 – Money Management Strategy: Financial Statements and Budgeting
92. (p. 84, 97) 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, a mortgage on the real estate of $23,000. What is the total of Darlene’s assets? What
actions could she take to increase her net worth?
93. (p. 78) Explain why opportunity cost is an important concept in money management.