PFIN (with PFIN Online, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
6th Edition
ISBN: 9781337117005
Author: Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher: Cengage Learning
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Chapter 2, Problem 4FPE
a)
Summary Introduction
To reconcile: The differences in given situation.
b)
Summary Introduction
To reconcile: The differences in given situation.
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Sarah Geronimo and Matteo Guidicelli are preparing their 2021 cash budget. Help the Guidicelli couple reconcile the following differences, giving reasons to support your answers.
Their only source of income is Matteo’s salary, which amounts to $5,000 a month before taxes. Sarah wants to show the $5,000 as their monthly income, whereas Matteo argues that his take-home pay of $3,917 is the correct value to show.
Sarah wants to make a provision for fun money, an idea that Matteo cannot understand. He asks, “Why do we need fun money when everything is provided for in the budget?”
Carl is a student at a college. He has a part-time job with take-home pay of $525 every two weeks. He has received a scholarship of $4100 this year. a) Use the data provided to design a monthly budget for Carl. Show your calculations for his income and expenses. Identify each expense as fixed or variable.
b) Is Carl earning enough to cover his expenses? If not, suggest how he could balance the budget
Leyia and Larry Hartley of Columbus, Ohio have decided to start a family next year, so they are looking over their budget. Leyia thinks that she can go on half-salary ($2,400 instead of $4,800 per month) in her job as a college textbook sales representative for about 18 months after the baby's birth; she will then return to full-time work.
Looking at the Hartley's current monthly budget, identify categories and amounts in their budget where they realistically might cut back $2,400. (Hint: Federal and state taxes should drop about $600 a month ($7,200 annually) as their income drops.)
Chapter 2 Solutions
PFIN (with PFIN Online, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
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