Docsity
Docsity

Prepare for your exams
Prepare for your exams

Study with the several resources on Docsity


Earn points to download
Earn points to download

Earn points by helping other students or get them with a premium plan


Guidelines and tips
Guidelines and tips

UGBA 135 Midterm Exam Questions And Answers, Exams of Entrepreneurship

UGBA 135 Midterm Exam Questions And Answers

Typology: Exams

2024/2025

Available from 07/04/2025

Estrelia
Estrelia 🇨🇦

4.2

(26)

7.5K documents

1 / 33

Toggle sidebar

This page cannot be seen from the preview

Don't miss anything!

bg1
UGBA 135 Midterm Exam Questions And
Answers
FICO Score -
correct answer measure of consumer credit risk
Highest FICO Score -
correct answer 850
Factors determining FICO Score -
correct answer Credit report is based on:
-35% paying your bills on time over time
-30% your debt-to-credit ratio ( borrowing money/ credit limit)
-15% length of credit history
-10% mix of credit cards and loans (like to see things other than
credit card; Rent, any loan (e.g. leasing car))
-10% new accounts and recent applications for credit
How many FICO scores does a person have? -
correct answer 3
pf3
pf4
pf5
pf8
pf9
pfa
pfd
pfe
pff
pf12
pf13
pf14
pf15
pf16
pf17
pf18
pf19
pf1a
pf1b
pf1c
pf1d
pf1e
pf1f
pf20
pf21

Partial preview of the text

Download UGBA 135 Midterm Exam Questions And Answers and more Exams Entrepreneurship in PDF only on Docsity!

Answers

FICO Score - correct answer ✅measure of consumer credit risk Highest FICO Score - correct answer ✅ 850 Factors determining FICO Score - correct answer ✅Credit report is based on: -35% paying your bills on time over time -30% your debt-to-credit ratio ( borrowing money/ credit limit) -15% length of credit history -10% mix of credit cards and loans (like to see things other than credit card; Rent, any loan (e.g. leasing car)) -10% new accounts and recent applications for credit How many FICO scores does a person have? - correct answer ✅ 3

Answers

How do you establish good credit? - correct answer ✅borrow $ and pay it back on time according to its terms How much is taken out of your paycheck for SS and Medicare? - correct answer ✅-12.4% of earned income to SS -2.9% of earned income to Medicare Debt-to-credit ratio - correct answer ✅how to calculate: -$3000 debt, $6000 in credit :: 3000/6000 = 50% D/C ratio -try to be below 50% || 30% is the best Identity Theft: if you're a victim - correct answer ✅-close and replace all accounts that have been tampered with or didn't open -file a police report If you are carrying a balance and you pay more than the minimum payment, where does the excess go? -

Answers

Three credit scoring agencies - correct answer ✅Transunion (tuc.com) -- Empirica score Equifax (equifax.com) -- Beacan score Experian (experian.com) -- Experian model Best time to establish credit - correct answer ✅when you don't need it aka younger i thinks When are your credit payments due? - correct answer ✅generally about 21-25 days after your billing cycle ends Secure vs unsecure line of credit - correct answer ✅Debit is secure Credit is unsecure (nothing to back it up other than credit history) How does cancelling inactive credit cards affect your credit score? - correct answer ✅-can lower because it will increase your d/c ratio -if you cancel, cancel newest card first

Answers

Prepaid cards - correct answer ✅-offered by banks and nonbanks -not linked to bank accounts -fees: activation, inactivity, to load money onto cards, if you don't load money each month, check balance info, to use an ATM for cash, for using a check to close an account Cash advance - correct answer ✅-using your credit card to withdraw cash -higher interest rates, no grace period (incur interest rates right off the bat) grace period - correct answer ✅set length of time after the due date during which payment may be made without penalty What is a retail charge card? - correct answer ✅-a credit card issued by a retailer allowing you to charge purchases made only with their store -higher interest rate 20-30% on unpaid balances

Answers

How often should you balance and review your credit card statement? - correct answer ✅Monthly If you are charged penalties and fees, do they charge interest on them? - correct answer ✅the next month you start paying a higher interest on balances and fees overdraft fee - correct answer ✅applies when you charge more than your credit limit Do all credit cards offer unconditional warranty on products? - correct answer ✅ Do credit card statements have to show the # of months needed to pay the minimum payment? - correct answer ✅

Answers

Proprietorship - correct answer ✅-business owned by one person -business dies when owner dies -unlimited liability Does a proprietor file a separate tax return for the business? - correct answer ✅Yes, along with the 1040 form for themselves. -profits are taxed at ordinary income tax rates -losses can be used to reduce taxable income Partnership - correct answer ✅-owned by 2 or more entities -death of partner->continue business -limited liability to the amount of their investment -does not pay federal income taxes -share profit/loss proportionally Types of Partners - correct answer ✅unlimited and limited

Answers

-shareholders use the information on the K-1 to report the same thing on their separate tax returns W-2 Form - correct answer ✅-shows how much employer paid and what they took out -shows net income that you took in If you have $100k earned income, how much monthly would be taken out of your SS and Medicare combined? - correct answer ✅ 7650 If you are healthy, how long should you wait to claim SS? (age) - correct answer ✅ Do high income earners pay more for Medicare and receive higher benefits? - correct answer ✅ Who pays Part A of Medicare? - correct answer ✅Employers

Answers

Are SS benefits adjusted to cost of living? - correct answer ✅ Are SS benefits tax free income? - correct answer ✅ Are there surcharges for Medicare for high income earners? - correct answer ✅ Are SS and Medicare contributions tax deductible? - correct answer ✅No What is the 20% pass-through deduction? - correct answer ✅a special business structure that is used to reduce the effects of double taxation -a taxpayer other than a corporation is entitled to a deduction equal to 20% of the taxpayer's "qualified business income" earned in a "qualified trade or business." -available to any taxpayer "other than a corporation" -- proprietorships, S corporations, partnerships

Answers

Unearned Income - correct answer ✅taxable interest, ordinary and qualified dividends, business profits or losses, capital gain or losses, investment, interest on savings accounts, stocks, benefits Total Income - correct answer ✅Earned + Unearned Income AGI - correct answer ✅Total income - contribution to charity, retirement plan, student loan interest (tax deductible) Capital Gains Tax - correct answer ✅short term capital gains: for assets owned 12mnths or less, profit is added to income and taxed at maximum of 37% long term capital gains: for assets owned >12mnths, profit is subject to max 20% for singles (taxable income in excess of $425.8k), for married above $479k. below these income amounts, max 15%. even lower, may be eligible for 0%.

Answers

When do you have to file quarterly estimates of additional taxes? - correct answer ✅ What is a standard deduction? - correct answer ✅a dollar amount you subtract from income before it is taxed Do you need proof/records to substantiate the standard deduction?

correct answer ✅ Can you and your parents both claim you for a tax credit? - correct answer ✅idts Stock options - correct answer ✅-the right to purchase shares or stocks (but not obligated) -price of the shares is set by the board of directors of company - set price never changes -within a specified period of time (if still employed - usually lasts for 10 years)

Answers

market order - correct answer ✅best available price at that moment in time for an immediate purchase or sale of a stock market order to buy - correct answer ✅expect to buy at the ASK price market order to sell - correct answer ✅expect to sell at the BID price limit order - correct answer ✅specific price you set at which you are willing to either buy or sell a stock limit order to buy - correct answer ✅you set your TOP price you are willing to pay limit order to sell - correct answer ✅you set your LOWEST price you are willing to pay

Answers

of disciplines -

correct answer ✅ 11 NEVER borrow money to buy stocks. Market timing. It is best to invest in stocks with money you won't need for 5 years. Identify trends. Dollar-cost averaging is investing a set amount of money in shares of stock on a regular time schedule, regardless of the price. Diversify. Stage and stagger your purchases. Allocation of assets or rebalancing: Review the allocation of assets in your portfolio at least once a year. In attempting to forecast sales and earnings attributable to an individual share of stock, look ahead 6-18 months. Do your homework! Keep it simple and stay informed. good dividend - correct answer ✅provides a current yield greater than interest than on a 10 year treasury bond

Answers

Successful stock investors look ahead _____ months - correct answer ✅6 - 18 months What is single most important factor to pay more for stocks in future? - correct answer ✅Earnings--specifically, prospect of future earnings P/E Ratio - correct answer ✅-price of a share divided by earnings per share -tells you what the market is currently paying for each dollar of earnings PEG Rate - correct answer ✅-compares how much investors are currently willing to pay for each $ of earnings to the expected growth of future earnings -Used for trying to decide if a stock is in a "buy" or "sell" range -When PEG rate<1, BUY. when PEG rate>2, SELL/DON'T BUY

Answers

-compares P/E ratio and Growth rate of earnings Dollar cost averaging - correct answer ✅-investing a set amount of money in the shares of a business on a regular time schedule regardless of the price of the shares at the time -mathematically, doing this will allow you to buy more shares at lower prices than at higher prices close end fund - correct answer ✅-pooled investment portfolios which raise money by issuing and selling a set number of shares in an IPO -management fees are lower than open-end funds financial advisor acting as fiduciary - correct answer ✅ Do you make more money owning low price or high price stocks? - correct answer ✅neither; depends