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Banking & Budgeting Unit Review

Define the following terms:

1- Cash Flow:

2- Fixed Expenses (provide examples):

3- Variable Expenses (provide examples):

4- Deposit:

5- Interest:

6- Deposit Slips:

7- Post-dating:

8- Void:

9- Endorse:

10- Simple Interest:

11- Compound Interest:

12- Debit Card:

Answer the following questions:

13- List the four parts that every budget should include.

14- When making a budget, why should you actual spending never exceed your budgeted spending?

15- List the tree types of banking institutions and provide examples of each.

16- Compare and contrast credit unions and commercial banks.

17- What is the purpose of writing a check?

18- What is the purpose of balancing a checkbook?

19- Why is having the debit card connected to your checking account a pro AND a con?

20- What does it mean to overdraw on your account? Describe overdraft protection.

Complete the following math problems. Be sure to SHOW ALL YOUR WORK, or no credit will be given.

21- You just accepted your first job and you’ll be earning a gross income of $56,200 per year. You live on your own and are responsible for all expenses, including rent, car, insurance, cell phone, utilities, entertainment, food, saving and miscellaneous expenses. You have to pay 17.65% of your gross income in taxes. Calculate both your yearly and monthly net pay with using this information.

Once you know the monthly net pay, calculate your monthly budget for these different expenses (all expenses are a percent of monthly net pay). Once you get the total monthly expenses, interpret your spending habits and monthly budget. Make sure your answer is in budget form.

Rent: 25%, Utilities: 10%, Car Insurance: 5%, Car Payment: 7%, Occasional Spending: 15%, Savings: 12%, Food:5%, Cell Phone: 7%, Entertainment: 5%

22- You invested $45,000.62 in the bank. The account yields 12%, is compounded monthly, and sits in the bank for 6 years. What is the final value of the investment at the end of 6 years?

23- Rory invests $300.00 in a bank who offers a yielding rate 6.8%. Parker decided that he wants to leave the money in the bank for 19 years. What is the final value of the investment at the end of 19 years? How much interest has the investment earned?

24- You are buying your parking pass from Hazen High School on October 12, 2015. The pass costs $45.00. Fill out the following check appropriately.

25- Below is a list of transactions for the month of December. Enter these transactions into the check register below and calculate your December Ending Balance.

Check Number Date Transaction AmountBeginning Balance $2,500.00

1025 12/1 Adam Smith- Rent $1,100.00DC 12/3 Safeway $75.00

12/10 Deposit- Paycheck $2,715.481026 12/12 Macy’s $150.001027 12/13 Daytime Daycare $200.00DC 12/15 Napa $65.00

Interest $0.35