BUDGETING QUESTIONS AND ANSWERS | COMPLETE BUDGETING STUDY GUIDE
& PRACTICE TEST 2026/2027
An expense that is constant each month is called a __________ expense. - ✔✔fixed
In order to stay on track for long term financial goals, money for emergency spending should be taken
first from your - ✔✔discretionary money.
Paying for transportation to and from work is an example of - ✔✔a variable expense.
From what part of income should someone take savings? - ✔✔what otherwise would be discretionary
income
To change gross income, someone would need to - ✔✔earn more money.
Why might variable expenses change a great deal at different times of year? - ✔✔Heating and cooling
costs might vary considerably.
Which is the best way to achieve long-term financial goals? - ✔✔Save more money from net income.
In this budget, how much money is going toward optional expenses?
(Discretionary spending) - ✔✔$70
To create a balanced budget, one must make sure to - ✔✔spend as little as possible.
Which is an example of an income deduction? - ✔✔retirement savings
When a person invests income, he or she - ✔✔uses money in a way that will increase its value in the
future.
A short-term financial goal might include saving for - ✔✔a piece of furniture.
Why is net income lower than gross income? - ✔✔withholdings
When creating a budget, log fixed expenses - ✔✔after income.
& PRACTICE TEST 2026/2027
An expense that is constant each month is called a __________ expense. - ✔✔fixed
In order to stay on track for long term financial goals, money for emergency spending should be taken
first from your - ✔✔discretionary money.
Paying for transportation to and from work is an example of - ✔✔a variable expense.
From what part of income should someone take savings? - ✔✔what otherwise would be discretionary
income
To change gross income, someone would need to - ✔✔earn more money.
Why might variable expenses change a great deal at different times of year? - ✔✔Heating and cooling
costs might vary considerably.
Which is the best way to achieve long-term financial goals? - ✔✔Save more money from net income.
In this budget, how much money is going toward optional expenses?
(Discretionary spending) - ✔✔$70
To create a balanced budget, one must make sure to - ✔✔spend as little as possible.
Which is an example of an income deduction? - ✔✔retirement savings
When a person invests income, he or she - ✔✔uses money in a way that will increase its value in the
future.
A short-term financial goal might include saving for - ✔✔a piece of furniture.
Why is net income lower than gross income? - ✔✔withholdings
When creating a budget, log fixed expenses - ✔✔after income.
