Question

25) 25) A budget deficit would result when a person's or family's A) Assets exceed liabilities. B) Net worth decreases. C) Actual spending is less than planned spending. D) Actual spending exceeds planned spending. E) Actual spending equals planned spending. 26) 26) After having established a spending plan, it is important to A) Keep track of your actual income and expenses. B) Pay attention only to expenses that are more than 10 percent of your salary. C) File the budget in a safe deposit box. D) Compare it to the previous budget. E) None of these are true since budgets are just estimates. 27) 27) Patrick Guitman has a net worth of $145,000 and liabilities of $155.000. What are his total assets? A) $10,000 B) $200,000 C) $145,000 D) $300,000 E) $155,000 28) Which of the following is NOT a tax that most people pay? A) Local taxes on property B) Federal taxes on possessions C) Federal taxes on earnings D) State taxes on purchases 29 29) The maximum amount that an individual can give another in a year without being subject to estate taxes is A) All gifts are taxable. B) No gifts are taxable. C) $10,000. D) $5,000. E) $15,000

Answer 1

25. The correct answer is (D) When actual spending exceeds planned spending When the actual spending exceeds the planned spending, it is called the budget deficit. 26.) The correct answer is (A) Keep track of actual income and expenses. Even after you established a spending plan it is important to keep track of your spending pattern. 27.) The formula for net worth is Net worth = Total assets - Total liabilities 145000 = Total assets - 155000 Total assets = 145000+155000 = 300000 28.) The correct answer is (B) Federal taxes on possession. All other taxes are paid by most people. 29.) The correct answer is (E) 15000 For year 2019, the amount of tax-free gift is applicable up to 15000. In a certain year you can give gifts up to a certain amount which are tax free.