FIN 138 EXAM QUESTIONS WITH VERIFIED SOLUTIONS LATEST UPDATE 2026
The goal of monetary asset management is to maximize interest earnings and minimizing fees while
keeping funds safe and readily available. - Answers True
Liquidity is the speed and ease with which an asset can be converted to cash. - Answers True
Which of the following are monetary assets? - Answers Money market accounts, cash on hand, and
certificates of deposit.
How can a person transfer money out of his or her checking account? - Answers Write a check, use
debit card, make electronic fund transfers.
Automatic Funds Transfer Agreement - Answers transmitted from savings account to checking for
overdraft (protection from bad check fees)
Form used to notify you of the taxable interest you have earned in a given year from a checking or
savings account. - Answers 1099 Form.
Payable-on-death account - Answers Account payable to a designated person on the death of all
original depositors.
Absent-minded Alfred lost his debit card on May 1. He reported it missing the next day; however,
$600 had been already purchased with the card without the use of his PIN number. According to the
Electronic Funds Transfer Act, how much of this $600 loss is Alfred responsible for? - Answers $50
A mutual fund - Answers is an investment company that raises money by selling shares to the public
and then invests that money in a diversified portfolio of investments
The more frequent the compounding - Answers the greater effective return for the saver.
What is the least expensive way of protecting yourself from fees should you overdraft your checking
account? - Answers An automatic funds transfer agreement.
Deposits in credit unions with federal charters are insured through - Answers National Credit union
share insurance fund (NCUSIF).
Stock brokerage firms - Answers are not federally insured institutions
A check drawn on a financial institution, backed by the financial institution's finances, and made out
to a specific payee is called a - Answers Cashier Check
Which of the following is not a benefit of a savings account? - Answers Account holders must give 30
to 60 days' notice for withdrawals
Diana and Kim are roommates in college and Diana owes Kim for last month's rent. When Diana
receives a check from her mother for the rent, what type of endorsement should Diana use to sign
this check over to Kim? - Answers Special endorsement
Which of the following is the best advice for people who want to start saving regularly? - Answers Pay
yourself first
Joint Tenancy - Answers A form of concurrent ownership, which occurs when two or more persons
own a single estate in land, with right of survivorship. Must have equal shares, right to partition.
Which of the following is an example of an unsecured debt? - Answers Signature loans.
The method of paying off a loan through which a portion of each payment goes to the principal and a
portion to interest with the interest portion declining and the principal portion increasing each month
as the debt is paid down is called - Answers Amortization.
Zelda was approved for a $3,000, two-year, 11 percent loan with the finance charges figured using the
discount method. How much cash will Zelda receive from this loan? - Answers $2,340
The strategy of shifting the payment dates of deductible items is called - Answers Accelerated
deductions.
Which of the following investments normally produce(s) tax-exempt income? - Answers Municipal
Bonds.
A tax credit of up to ______ is available for qualifying costs of an adoption. - Answers $13,190
Most valuable to a tax payer for the tax savings it provides - Answers Dependent Care Credit
Which of the following expenses on a home is not tax deductible annually? - Answers Homeowners
insurance premium
You are legally required to include which of the following in gross income? - Answers Alimony
received, lottery winnings, illegal income.
Earned income is reported to the recipient on a - Answers W-2 form.
The goal of monetary asset management is to maximize interest earnings and minimizing fees while
keeping funds safe and readily available. - Answers True
Liquidity is the speed and ease with which an asset can be converted to cash. - Answers True
Which of the following are monetary assets? - Answers Money market accounts, cash on hand, and
certificates of deposit.
How can a person transfer money out of his or her checking account? - Answers Write a check, use
debit card, make electronic fund transfers.
Automatic Funds Transfer Agreement - Answers transmitted from savings account to checking for
overdraft (protection from bad check fees)
Form used to notify you of the taxable interest you have earned in a given year from a checking or
savings account. - Answers 1099 Form.
Payable-on-death account - Answers Account payable to a designated person on the death of all
original depositors.
Absent-minded Alfred lost his debit card on May 1. He reported it missing the next day; however,
$600 had been already purchased with the card without the use of his PIN number. According to the
Electronic Funds Transfer Act, how much of this $600 loss is Alfred responsible for? - Answers $50
A mutual fund - Answers is an investment company that raises money by selling shares to the public
and then invests that money in a diversified portfolio of investments
The more frequent the compounding - Answers the greater effective return for the saver.
What is the least expensive way of protecting yourself from fees should you overdraft your checking
account? - Answers An automatic funds transfer agreement.
Deposits in credit unions with federal charters are insured through - Answers National Credit union
share insurance fund (NCUSIF).
Stock brokerage firms - Answers are not federally insured institutions
A check drawn on a financial institution, backed by the financial institution's finances, and made out
to a specific payee is called a - Answers Cashier Check
Which of the following is not a benefit of a savings account? - Answers Account holders must give 30
to 60 days' notice for withdrawals
Diana and Kim are roommates in college and Diana owes Kim for last month's rent. When Diana
receives a check from her mother for the rent, what type of endorsement should Diana use to sign
this check over to Kim? - Answers Special endorsement
Which of the following is the best advice for people who want to start saving regularly? - Answers Pay
yourself first
Joint Tenancy - Answers A form of concurrent ownership, which occurs when two or more persons
own a single estate in land, with right of survivorship. Must have equal shares, right to partition.
Which of the following is an example of an unsecured debt? - Answers Signature loans.
The method of paying off a loan through which a portion of each payment goes to the principal and a
portion to interest with the interest portion declining and the principal portion increasing each month
as the debt is paid down is called - Answers Amortization.
Zelda was approved for a $3,000, two-year, 11 percent loan with the finance charges figured using the
discount method. How much cash will Zelda receive from this loan? - Answers $2,340
The strategy of shifting the payment dates of deductible items is called - Answers Accelerated
deductions.
Which of the following investments normally produce(s) tax-exempt income? - Answers Municipal
Bonds.
A tax credit of up to ______ is available for qualifying costs of an adoption. - Answers $13,190
Most valuable to a tax payer for the tax savings it provides - Answers Dependent Care Credit
Which of the following expenses on a home is not tax deductible annually? - Answers Homeowners
insurance premium
You are legally required to include which of the following in gross income? - Answers Alimony
received, lottery winnings, illegal income.
Earned income is reported to the recipient on a - Answers W-2 form.
