PFIN Online, 1 term (6 months) Printed Access Card for Billingsley/Gitman/Joehnk's PFIN 6
6th Edition
ISBN: 9781337118026
Author: Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher: Cengage Learning
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Question
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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Students have asked these similar questions
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
Trevor and Kristen Hill need to prepare a cash budget for the
next three months to make sure that they can cover their
expenditures during the period. Trevor and Kristen have
tracked their finances for the past few years using an app, and
thus know what percentage of their take-home pay of $5500
goes for various expenses.
Expenses
Housing
Utilities
Food
Transportation
Medical/dental
Contributions
Clothing (3% normally; $450 in Month 3)
Property Taxes ($1260, Month 2 only)
Appliances
Personal Care
Travel and Entertainment (6%; $1400 in Month 3)
Other
Savings
29.0%
5.0%
9.5%
6.0%
5.0%
10.5%
3.0%
a.
1.0%
2.0%
6.0%
5.0%
7.5%
The Hills must maintain a $1500 cash balance to avoid
checking fees; however, the balance on March 31, 2021 was
$1300. Their savings account balance on March 31 was
$20,000.
Prepare a quarterly cash budget for Trevor and Kristen
for the next three months.
b. Using your calculations, show the monthly inflows and
outflows and the end-of-month balances for the Hills…
1. Evan wants to start using a budget to curb spending and begin saving money. His estimates on income
and spending are recorded in the table below. How much can Evan spend on his credit card to maintain
a positive cash flow of $100/month?
Use 4 weeks = 1 month even though this is generally not true.
Expenses
Rent $700/month
Groceries $45/week
Tuition and fees $6500/year
Credit card ? (covers games, streaming and dining out)
Phone $60/month
Income
Part-time job $1200/month
Loan $2500 twice a year
Scholarship $3000/year
Transportation $200/month
2. Tamara likes getting breakfast tacos (two) and coffee (large) at the restaurant down the street and
spends $6 on Tuesday, Thursday, and Saturday mornings for the pleasure.
(a) How much is she spending each year on breakfast tacos and coffee?
(b) Do some research to estimate how much money she would save each year by making the tacos
and coffee at home. Answers for this will vary. Be clear about how you arrived at your estimate.
deposits
How
Chapter 2 Solutions
PFIN Online, 1 term (6 months) Printed Access Card for Billingsley/Gitman/Joehnk's PFIN 6
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Similar questions
- 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 ($7,200 annually) as their income drops.)arrow_forward10. Cameron is in grade 12 and works part-time in a bike shop. His monthly budget is shown. Expenses ($) transportation clothes Income ($) March 1-15 458.68 109.00 March 16-30 494.02 100.00 entertainment 125.00 college savings 200.00 car fund 175.00 motorcycle lessons 250.00 What should Cameron do to his budget, if his income remains the same for the next month? a. Increase his clothing expense by at least $6. b. Reduce his clothing expense by $2. c. Reduce his clothing expense by at least $7. d. His budget is already balanced.arrow_forwardMrs. Collins wants to start a clothing business. He plans to invest Gh₵ 30,000 of his savings into the new business. She thinks that some additional finance will be required in the short term and plans to approach his bank for this. Mrs. Collins asks for your assistance in producing a cash budget for his new business for the next six months (i.e., January – June, 2021). She provides the following information: The business, which is to be called ‘Pink Lady Clothing’ will commence in January 2021.Non-current assets costing Gh₵ 10,000 will be bought in early January. These will be paid for immediately and are expected to have a five-year life, at the end of which they will be worthless.An initial stock (inventory) of goods costing Gh₵ 6,000 will be bought and paid for at the beginning of January.Mrs. Collins is estimating that the goods she expects to sell in January will be replaced by purchases made in January, and so on. The following are monthly sales forecast: January February March…arrow_forward
- The Yeung family is using the Quantitative Reasoning Process to set up a monthy budget. They have a monthly income of $4,365. In July, their monthly expenses were $3,113, their monthly state and federal taxes totaled $778, and they contributed $230 to their savings plan. What was the Yeung's monthly cash flow for July? O $0 (Their income is exactly the same amount as they are spending and saving.) $244 (Their income is a little more than they are spending and saving.) O -$508 (Their income is a lot less than they are spending and saving. They are going into debt) $508 (Their income is a lot more than they are spending and saving.) -$244 (Their income is a little less than they are spending and saving. They are going into debt)arrow_forwardThis is Ben’s budget. Use his budget to determine the answer to the following question: Calculate the amount of income tax Ben owes monthly using the tax rate of 25%.arrow_forwardAngela's monthly disposable income is $1,749. She has monthly expenses of $1,548 (including recreational expenses of $219) and net cash flow of $201 per month. Angela analyzes her personal budget and decides that she can reduce her recreational spending by $48 per month. If Angela is saving $249 per month, what is her savings rate (i.e., savings as a percentage of disposable income)? Angela's savings rate is ___%. (Round to two decimal places.)arrow_forward
- What is the amount of Laura’s monthly cash outflows if she chooses to rent the apartment by her herself? Use the rent amount for the one bedroom apartment to complete her budget?arrow_forwardThis is Ben’s budget. Use his budget to determine the answer to the following question: Calculate the amount of tax Ben owes monthly using the tax rate of 25%.arrow_forward3. Frank decides he better make a budget! Use the following information to calculate his budget. Frank has net income of $45 000 a year. This table shows his expenses. Expense Amount Student loan payments $115/every 2 weeks Mortgage Insert from above Food $75/week Cell phone plan $69/month Utilities $40/every 2 weeks Car lease $305/month including maintenance) Gasoline $65 every 2 weeks on average Miscellaneous $125/every 2 weeks a) Use the data provided to design a monthly budget for Frank. Show your calculations and indicate whether each expense or income is fixed or variable. b) How much can Frank save in a 3-month period? Show your calculations. c) Is there something Frank is forgetting in his budget? What would you recommend for changes?arrow_forward
- The Financial Statements of harry and Belinda Johnson Suggest Budgeting Problems Harry has worked at a medium-size interior design firm for five years and earns a salary of $4,080 per month. He also receives $3,000 in interest income once a year from a trust fund set up by his deceased father’s estate. Belinda earns a salary of $6,400 per month, and she has many job-related benefits including flexible benefits program, life insurance, health insurance, a 401(k) retirement program, workplace financial education, and a credit union. The Johnsons live in an old apartment located approximately halfway between their places of employment. However, their rent will increase by $100 a month in July. Harry drives about ten minutes to his job, and Belinda travels about 15 min- utes via public transportation to reach her downtown job. Harry and Belinda’s apartment is very nice, but small, and it is furnished primarily with furniture given to them by some of his friends. Soon after getting married,…arrow_forwardThese are Time value of Money questions: QUESTION 1 Marina had an accident with her car and the repair bill came to $900. She didn't have any emergency fund money and no extra money in her monthly budget, so she ended up borrowing from a pay-day loan company. As long as she can pay the loan back at the end of the 30 day period she won't be charged any interest, technically. However, she did have to pay an $17 processing fee per $100 that she borrowed. If she were to consider the processing fee to represent interest paid in her formula, what would she discover to be the annual interest rate she was charged on her short term loan? QUESTION 2 The end of the month has arrived and Marina was only able to save up a portion of the money she owed so far. This means she will have to delay paying off on the remaining amount. Besides the delayed payment fee that she is charged, she will now have to pay interest on the remaining amount until it is paid off. The APR (annual percentage rate) is…arrow_forwardThe Financial Statements of harry and Belinda Johnson Suggest Budgeting Problems Harry has worked at a medium-size interior design firm for five years and earns a salary of $4,080 per month. He also receives $3,000 in interest income once a year from a trust fund set up by his deceased father’s estate. Belinda earns a salary of $6,400 per month, and she has many job-related benefits including flexible benefits program, life insurance, health insurance, a 401(k) retirement program, workplace financial education, and a credit union. The Johnsons live in an old apartment located approximately halfway between their places of employment. However, their rent will increase by $100 a month in July. Harry drives about ten minutes to his job, and Belinda travels about 15 min- utes via public transportation to reach her downtown job. Harry and Belinda’s apartment is very nice, but small, and it is furnished primarily with furniture given to them by some of his friends. Soon after getting married,…arrow_forward
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