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QUIZ CHAPTER 3 QUESTIONS AND ANSWERS WITH SOLUTIONS 2024
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QUIZ CHAPTER 3 QUESTIONS AND ANSWERS WITH SOLUTIONS 2024
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QUIZ CHAPTER 3 QUESTIONS ANDANSWERS WITH SOLUTIONS 2024
false - ANSWER a balance sheet describes an individual's financial progress over a period of time,
generally a year.
false - ANSWER a balance sheet has three components: income, expenses and value.
true - ANSWER assets represent the total dollar value of what you have legal title of.
false - ANSWER there are three basic categories of assets, they are monetary assets, tangible assets and
liquid assets .
true - ANSWER monetary assets include cash and near-cash items that can be readily converted to cash.
false - ANSWER tangible assets are the value of your ownerships of stocks and bonds, tax sheltered
investments such as 401(k) and IRA retirement accounts.
true - ANSWER tangible assets are assets such as your home, car, boat furniture.
true - ANSWER liabilities represents the dollar value of what you owe to the other people or what you
owe institutions such as banks or creditor.
false - ANSWER the formula for net worth is: Assets + Liabilities = Net Worth
false - ANSWER it is getting close to the end of the month and you need to pay your apartment rent for
the next month. your landlord lord gives you until the 10th of next month to pay your rent on time. since
you don't need to pay next month's rent until next month then right now is considered a long-term (or
non-current) liability.
the total $450 is a short-term liability - ANSWER you have been paying $150/month on your car for
almost 4 years. in three months you will have your car completely paid off. you review what you still
owe: $450, and think, it will be great when i will no longer have a car loan.
true - ANSWER technically a person is "insolvent" if they have a negative net worth.
true - ANSWER a cash-flow statement summarizes transactions that have taken place over a specific
period of time.
true - ANSWER a surplus means that my total income exceeds my total expenses.
false - ANSWER an example of a fixed expense is my monthly electricity payment.
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