THINKING SECTION 14. Ella and Sam have a net income of $43 000 a year. Their expenses include bi-weekly mortgage payments of $620, $183 a month for transit passes, utility costs that average $150 a month, savings of $312 a month, $55 a month for a phone and Internet package, $120 a week for groceries, $60 a week for entertainment, and miscellaneous expenses of $400 a month. a) Convert all income and expense amounts to monthly amounts. b) Are Ella and Sam within their budget? If so, how much more could they save each month? If not, what expenses could they reduce?
THINKING SECTION 14. Ella and Sam have a net income of $43 000 a year. Their expenses include bi-weekly mortgage payments of $620, $183 a month for transit passes, utility costs that average $150 a month, savings of $312 a month, $55 a month for a phone and Internet package, $120 a week for groceries, $60 a week for entertainment, and miscellaneous expenses of $400 a month. a) Convert all income and expense amounts to monthly amounts. b) Are Ella and Sam within their budget? If so, how much more could they save each month? If not, what expenses could they reduce?
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter9: Current Liabilities, Contingencies, And The Time Value Of Money
Section: Chapter Questions
Problem 9.19E
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His expenses include bi-weekly mortgage payments of $667.29, annual property taxes of $1961.45,
$70 a month for a phone and Internet package, $110 every 2 weeks for groceries, $20 a week for
entertainment, and miscellaneous expenses of $160 every 2 weeks.
Moswen wants to take out a car loan that will cost $268.06 each month.
Can he afford the loan without changing his budget? Explain.
THINKING SECTION
14. Ella and Sam have a net income of $43 000 a year.
Their expenses include bi-weekly mortgage payments of $620, $183 a month for transit passes, utility
costs that average $150 a month, savings of $312 a month, $55 a month for a phone and Internet
package, $120 a week for groceries, $60 a week for entertainment, and miscellaneous expenses of
$400 a month.
a) Convert all income and expense amounts to monthly amounts.
b) Are Ella and Sam within their budget?
If so, how much more could they save each month? If not, what expenses could they reduce?
100
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