Chapter Two Flashcards
Budget
a written plan for giving, saving, and spending
Income:
money received for work, as a gift, or through investments
Fixed Expense:
expense that remains the same from month to month
Intermittent Expense:
expense that occurs at various times throughout the year and tends to be in large, lump sums
Discretionary (Nonessential) Expense:
expense for things you don’t need
Zero-Based Budget:
a cash-flow plan that assigns an expense to every dollar of your income; the goal is for the total income minus the total expenses to equal zero
Net Income:
what a person earns after payroll taxes and other deductions are taken out; often referred to as take-home pay
Gross Income:
the amount you earn before taxes and other payroll deductions
Cash-Flow Statement:
a record that summarizes all of the income and outgo (spending) over a certain time period
Irregular Income:
income that comes in at different amounts or at different times, or both
Commission:
earnings based on a percentage of the sales made
Although the majority of Americans think budgeting is important, about______ of Americans actually use a budget.
35%
Which of the following is NOT a component of a budget?
Credit score
What are the Four Walls?
Food, utilities, shelter, and transportation
Online budgeting apps are more effective than budgeting with pen and paper. T/F
F
