Free Practice Quiz Question List

02 Budgeting and Cash Flow Online Quiz Questions

Use this free practice quiz with 20 questions to review 02 Budgeting and Cash Flow, test your knowledge, and prepare for your next test or exam.

20 questions

True or false

1 point

A household's utility bill varies from month to month. True or false: this difference automatically means the household has failed to follow its budget.

A
True
B
False

True or false

1 point

A monthly plan shows that income equals planned expenses and savings. True or false: this alone proves the household will have enough cash to pay every bill when it is due.

A
True
B
False

True or false

1 point

A worker's income changes from month to month. True or false: the worker should build the budget around the highest recent month's income to avoid underestimating what is available.

A
True
B
False

Choose one

1 point

What additional question does a cash-flow plan help answer beyond whether a monthly budget balances?

A
It estimates how much a household will earn before taxes.
B
It considers when income arrives and bills are due.
C
It guarantees the same spending pattern every month.
D
It removes the need to track actual spending.

Choose one

1 point

A household's planned expenses and savings exceed its estimated take-home income. What is the most appropriate next step before the month begins?

A
Keep the plan unchanged and use a credit card for the difference.
B
Adjust planned amounts before the month begins so the plan is workable.
C
Remove all savings from the plan automatically.
D
Count possible extra income before it arrives.

Choose one

1 point

Actual spending in one category repeatedly exceeds its planned limit. Which response best uses that information?

A
Treat each difference as proof that budgeting is ineffective.
B
Investigate the cause and revise the plan if an estimate or limit is unrealistic.
C
Ignore the differences as long as the monthly income stays the same.
D
Increase every spending category by the same amount.

Choose all

1 point

Which practices help make a household budget more realistic? Select all that apply.

A
Include less-frequent costs such as annual insurance.
B
Assume a credit card will cover any planned shortfall.
C
Set flexible category limits using actual spending as a guide.
D
Include savings and planned expenses for future needs.

Choose all

1 point

A cash-flow calendar shows that available cash may be too low before a bill is due. Which actions may help address the shortfall? Select all that apply.

A
Consider whether a bill's due date can be changed.
B
Delay flexible spending if appropriate.
C
Wait until after missing a payment to contact the biller.
D
Contact the biller before missing a payment.

Fill in the blank

1 point

When budgeting, estimate using a cautious review of past months if income varies, rather than assuming the will repeat.

Fill in the blank

1 point

In a budget, rent and loan payments are costs, while car repairs and annual insurance are expenses.

Written response

1 point

A household plans for monthly take-home income of $\$2400$ , planned expenses of $\$1900$ , and savings of $\$300$ . What is the planned remainder in dollars?

Written response

1 point

What is the name of the plan that considers when money arrives and bills are due?

Open ended

1 point

A household's income has risen. Explain one way to adapt its budget so that the higher income supports its priorities rather than automatically increasing spending.

Choose one

1 point

A worker expects a one-time bonus but has not received it yet. How should the worker treat that money when planning the current budget?

A
Add it to the budget as soon as it seems likely.
B
Treat it as available only after it arrives.
C
Use it to replace all estimates of regular income.
D
Assume it will arrive every month.

Choose one

1 point

A household pays an insurance bill once a year. Which budget category best fits this cost?

A
A fixed monthly cost
B
A less-frequent expense
C
A variable weekly cost
D
A flexible personal expense

Choose one

1 point

A worker's monthly income changes from month to month. Which approach is most consistent with building a workable budget?

A
Use the highest monthly income as the estimate.
B
Review past months and use a cautious estimate.
C
Count expected extra income before it arrives.
D
Exclude all income that varies from month to month.

Written response

1 point

A household plans for $\$2{,}800$ in take-home income, $\$2{,}250$ in expenses, and $\$400$ in savings. What is the planned remainder, in dollars?

Choose one

1 point

A household is setting category amounts after tracking its spending. Which approach best matches the recommended order for setting budget priorities?

A
Set the same limit for every category, regardless of past spending.
B
Fund personal spending first, then use borrowing for required bills.
C
Plan for essentials and required payments, then set realistic flexible limits.
D
Leave out savings and future needs until all flexible spending is planned.

Choose one

1 point

A weekly cash-flow calendar shows that a household may not have enough money available when a bill is due. What is the most appropriate next step?

A
Consider whether the bill date can be changed, flexible spending delayed, or the biller contacted.
B
Assume the month's balanced total means no action is needed.
C
Rely on borrowing to cover the shortfall without changing the plan.
D
Wait until after missing the payment to contact the biller.

Written response

1 point

A weekly cash-flow plan starts with $\$360$ , includes $\$850$ of income, and has $\$940$ of expenses. What is the ending balance for the week, in dollars?