Efram and Sofia, both aged $24,$ are newlyweds. Their after$-$tax salaries are $$55,000$ and $$49,000,$ respectively. They have been renting a flat since they started work but have decided to buy a house. Their decision has been made easier because Efram$$s parents said that when they retire at age $65$ in one year$$s time they would withdraw $$40,000$ from their combined superannuation funds and give the money to Efram and Sofia to help them to buy a house. When they approached the bank for a loan they had to provide details of their income, expenses, assets and liabilities to the lending officer. The items provided for their personal balance sheet were:

Assets Bank account $$45,000$ Furniture$/$personal effects $$8,000$ Managed investment fund $$20,000$ Cars $$16,000$ Superannuation $$ Efram $$26,000$ Superannuation $$ Sofia $$21,000$

Liabilities Credit cards $$5,500$ Car loans $$3,000$

They also advise the lending officer that their monthly commitments are: $$ rent $$1,280$ car loans $$290$ They would prefer not to cash in their managed investment fund at present as the value has fallen by $8\%$ over the last $2$ months. They have instructed the fund manager to reinvest the distributions rather than receive them in cash. Their intention is to leave the investment to accumulate to meet the education expenses of the children they hope to have in the future.

They anticipate paying off their credit card debt in full next month and they would also have paid off the car loans in the next $12$ months. They also advise the lending officer that their current rate of household expenses $($not including the rent and repayments$)$ is about $$2,400$ per month.

a$.$ Prepare a net worth statement and ratio analysis for their current situation.

b$.$ Prepare a net worth statement and ratio analysis for their estimated situation when they receive the gift from Efram's parents and purchase a house valued at $$380000$ with repayments based on $$2200$ per month.

c$.$ Discuss the impact on their savings and debt service ratio if Sofia was to cease working for a period of time to have children