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18 terms

Personal Finance Ch. 2

STUDY
PLAY
Money Management
planning how to get the most from your money
Assets and Liabilities
a balance sheet shows a company's profit and loss
Pay yourself first
Taking out a portion of a paycheck for saving or investing before using any of the check for spending.
fixed expense
expenses which stay basically the same from month to month, such as housing and transportation.
variable expense
costs that vary in amount and type, depending on events and the choices you make
Income
earnings from work or investments
Gross pay
the total amount of an employee's earnings before deductions are taken out
Net Pay
the total earnings paid to an employee after payroll taxes and other deductions
budget
a summary of intended expenditures along with proposals for how to meet them
personal financial statement
a document that provides information about an individual's current financial position and presents a summary of income and spending
Discretionary income
disposable income available for spending and saving after an individual has purchased the basic necessities of food, clothing, and shelter
cash flow statement
A measure of the money you receive and the money you spent
Current Liabilities
liabilities due within a short time, usually within a year
Investment Assets
Money which has been invested long-term which will provide future income
Market Value
the price at which buyers and sellers trade the item in an open marketplace
Long-term Liabilities
liabilities owed for more than a year
Liquid Asset
an asset that can quickly be converted into cash with little risk of loss
Personal Possessions
type of asset that includes automobiles, electronics, jewelry