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Chapter 3 Budgeting

Total questions: 25

Worksheet time: 13mins

Name
Class
Date
1.
Which of the following is a consequence of overdrawing your checking account? 
a)
Stress from money mismanagement 
b)
Bounced check fee from the store
c)
Overdraft fee from your bank 
d)
All of these 
2.
Doing a budget does not: 
a)
Make overspending more likely
b)
Make your money go further
c)
Show if you are overspending in an area
d)
Remove guilt and shame sometimes associated with a purchase
3.
Your monthly budget should include: 
a)
Discretionary expenses 
b)
Fixed expenses
c)
Variable expenses 
d)
All of these 
4.
Which of the following is something that a typical millionaire would do? 
a)
Carry debt 
b)
Spend less money than he or she makes
c)
Lease a new car 
d)
Replace things that are not broken  
5.
A written budget, if followed, removes ________ from your finances. 
a)
Guilt 
b)
Management by crisis
c)
Overspending 
d)
All of these 
6.
The zero-based budget is the best method of budgeting because: 
a)
This type of budget is less complicated than other types of budgets
b)
Sticking to a zero-based budget requires less discipline
c)
A zero-based budget allows less money for wants
d)
The zero-based budget ensures that every dollar you make is assigned a specific purpose
7.
Rent is a: 
a)
Fixed expense 
b)
Variable expense
c)
Discretionary expense 
d)
Intermittent expense
8.
Eating out is a: 
a)
Fixed expense 
b)
Variable expense
c)
Discretionary expense 
d)
Intermittent expense
9.
Groceries  are a: 
a)
Fixed expense 
b)
Variable expense
c)
Discretionary expense 
d)
Intermittent expense
10.

Having more than one bank account is never a good idea since it can complicate money management.

a)

True

b)

False

11.

Which of the following is a consequence of overdrawing your checking account?

a)

Bounced check fee from the store

b)

Stress from money mismanagement

c)

Overdraft fee from your bank

d)

All of the above

12.

What is the percentage of Americans living paycheck to paycheck?

a)

70%

b)

25%

c)

50%

d)

40%

13.

The following are guidelines for budgeting with an irregular income except

a)

Prioritize the list in order of importance.

b)

Make a list of all your expenses for the month ahead.

c)

Budgeting with an irregular income is no different than budgeting with a regular income.

d)

When your check comes in, spend your money all the way down the list.

14.

Which of the following is NOT a record-keeping feature you could expect from your bank?

a)

A reconciliation sheet

b)

An account register

c)

Customer service reconciles your account for you

d)

A monthly account statement

15.

Which of the following account records would have the most current balance?

a)

Account balance statement from the ATM

b)

Your own account register

c)

Your monthly bank statement

d)

All of these records will have accurate account balances

16.

Which of the following statements is false?

a)

A cash flow statement summarizes all of the income and outgo (spending) over a certain time period.

b)

A budget is a written plan for saving and spending.

c)

A budget is meant to summarize the saving and spending that has taken place over the past year.

d)

A cash flow statement is reflective of what has already taken place.

17.

Which of the following account records would have the most current balance?

a)

Account balance statement from the ATM

b)

Your own account register

c)

Your monthly bank statement

d)

All of these records will have accurate account balances

18.

"Pay yourself first" means you should assign a portion of your income to saving and investing every month.

a)

True

b)

False

19.

If you write a zero-based budget every month, it is not necessary to reconcile your account.

a)

True

b)

False

20.

Setting up automatic account transfers is the easiest way to build your savings for your emergency fund or large purchases.

a)

True

b)

False

21.

The number one cause of divorce in North America today is stress and disagreements over money.

a)

True

b)

False

22.

Budgeting is crucial to your financial success.

a)

True

b)

False

23.

A debit card cannot be used for online purchases.

a)

True

b)

False

24.

Writing AND following a zero-based budget will help you avoid overspending and impulse purchases.

a)

True

b)

False

25.

Online bill pay allows you to make payments to whomever you wish without having to write a check and send it in the mail.

a)

True

b)

False