ABA CTFA Exam (page: 8)
ABA Certified Trust and Financial Advisor (CTFA)
Updated on: 25-Dec-2025

Viewing Page 8 of 91

Tangible assets that are immovable: land and anything fixed to it, such as a house is a person's:

  1. Investment
  2. Real property
  3. Liability
  4. Open credit obligation

Answer(s): B



It is actually a method of preparing financial statements in which only transactions involving actual cash outlays are recorded.

  1. Cash basis
  2. Expense
  3. Equity
  4. Cash deficit

Answer(s): A



An excess amount of expense over income resulting in insufficient funds as well as in decreased net value is called:

  1. Cash deficit
  2. Limited Liability
  3. Cash basis
  4. Net worth

Answer(s): A



Total liquid assets divided by total current debts; measures the ability to pay current debts. It is:

  1. Solvency ratio
  2. Liquidity ratio
  3. Savings ratio
  4. Debt service ratio

Answer(s): B



Total net worth divided by total assets; measures the degree of exposure to insolvency is:

  1. Solvency ratio
  2. Liquidity ratio
  3. Savings ratio
  4. Debt service ratio

Answer(s): A



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