Budget Assignment 1. Using your resources explain the 50/20/30 rule used to manage spending. Is this...
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Budget Assignment 1. Using your resources explain the 50/20/30 rule used to manage spending. Is this rule that most people follow in their monthly budgeting? 5 points BUDGETING PROBLEM 70 points Johnny is a recent graduate and has accepted a position with a Fortune 500 company. His start date 1/10 allows him to get paid for a (partial month) in January. In February he will get a full months pay. Johnny's gross income is 76,000.00 per year and he is paid on the 15th and the 30th of each. The first month (January) his expenses are approximately 30% of what they would be for a full month. His Health insurance starts after his first 30 days of employment His Federal Tax is withheld at 22% of his gross income. His state Tax is with held at 5%. City tax is 2% FICA is withheld at current rate; Health insurance is $211.00 per month. He moves into his apartment on the 15th of January and his rent is $1520. Since he lives in a city without public Transportation he decides to purchase a new the same day that he starts work and his first payment of $388.00 isn't due until March 10. His additional monthly expenses are: Utilities-$200; Cable $49.99; Cell phone$100.00; Gas $100.00 Food (groceries) $374.00; dry cleaners $45; He plans to spend no more than 15% of take home pay on Dining and entertainment. Car insurance $110; he pays someone to clean his apartment for $50 per month; He joined a gym in Feb $30 per month; He gives to his church $100 per pay period and also gives back to his community$75 per month to the local YMCA. He gets a haircut twice a month $20 and his student loan payments begin March 1 $125; his goal is to put aside 5% for retirement and 5% in a personal savings per pay period. He got a credit card in December and the Balance owed is $250.00 on which he pays the minimum due in January 25th but plans to pay it off during February. He has to pay $125 per pay period in child support for his 3 year son who lives with his mother. Instructions: Using the worksheets provided prepare a budget for Jan and Feb for Johnny Income Calculator GROSS INCOME Category Wages, Salary, Bonuses Interest Income Investment Income Other Income (e.g., child support, alimony) TAXES WITHHELD AND PAYMENT DEDUCTIONS Category Federal Income Tax State and Local Income Tax Social Security and Medicare Tax Employer Health Insurance Premium Employer Retirement Plan Contribution (e.g., 401k) Other TOTAL Category (Subtract taxes and deductions from gross income) Monthly Amount 1 Monthly Amount Monthly Amount Monthly Amount 2 Monthly Amount Monthly Amount 0 0 1 2 3 4 INCOME 5 Wages 6 Interest/dividends 7 Miscellaneous 8 Income totals 9 EXPENSES 10 Home 11 Mortgage/rent 12 Utilities 13 Home telephone 14 Cellular telephone 15 Home repairs 16 Home improvement 17 Home security 18 Garden supplies 19 Home totals 20 21 Daily living 22 Groceries 23 Child care 24 Dry cleaning 25 Dining out 26 Housecleaning service 27 Dog walker 28 Daily living totals 29 30 Transportation 31 Gas/fuel 32 Insurance 33 Repairs 34 Car wash/detailing services 35 Parking 36 Public transportation 37 Transportation totals 38 Personal budget Entertainment Video/DVD rentals Entertainment totals e O Cable TV 2 Movies/plays 3 Concerts/clubs 5 s Health 7 Health club dues B Insurance Prescriptions Over-the-counter drugs 1 Co-payments/out-of-pocket 2 Veterinarians/pet medicines 3 Life insurance 4 Health totals 5 6 Vacations 7 Plane fare 8 Accommodations 9 Food 50 Souvenirs 1 Pet boarding 52 Rental car 53 Vacations totals 64 55 Recreation 56 Gym fees 67 Sports equipment 38 Team dues 39 Toys/child gear 70 Recreation totals 71 B z D Dues/subscriptions Magazines Newspapers Internet connection Public radio Public television Religious organizations Charity Dues/subscription totals Personal Clothing Gifts 5 Salon/barber 5 Books Music (CDs, etc.) 3 Personal totals 9 O Financial obligations 1 Long-term savings 2 Retirement (401k, Roth IRA) 3 Credit card payments Income tax (additional) 5 Other obligations 6 Financial obligation totals 7 Misc. payments 9 Other 00 Other 01 Other 32 Other 03 Other 04 Misc. payments totals 05 06 Total expenses 07 Cash short/extra 08 Budget Assignment 1. Using your resources explain the 50/20/30 rule used to manage spending. Is this rule that most people follow in their monthly budgeting? 5 points BUDGETING PROBLEM 70 points Johnny is a recent graduate and has accepted a position with a Fortune 500 company. His start date 1/10 allows him to get paid for a (partial month) in January. In February he will get a full months pay. Johnny's gross income is 76,000.00 per year and he is paid on the 15th and the 30th of each. The first month (January) his expenses are approximately 30% of what they would be for a full month. His Health insurance starts after his first 30 days of employment His Federal Tax is withheld at 22% of his gross income. His state Tax is with held at 5%. City tax is 2% FICA is withheld at current rate; Health insurance is $211.00 per month. He moves into his apartment on the 15th of January and his rent is $1520. Since he lives in a city without public Transportation he decides to purchase a new the same day that he starts work and his first payment of $388.00 isn't due until March 10. His additional monthly expenses are: Utilities-$200; Cable $49.99; Cell phone$100.00; Gas $100.00 Food (groceries) $374.00; dry cleaners $45; He plans to spend no more than 15% of take home pay on Dining and entertainment. Car insurance $110; he pays someone to clean his apartment for $50 per month; He joined a gym in Feb $30 per month; He gives to his church $100 per pay period and also gives back to his community$75 per month to the local YMCA. He gets a haircut twice a month $20 and his student loan payments begin March 1 $125; his goal is to put aside 5% for retirement and 5% in a personal savings per pay period. He got a credit card in December and the Balance owed is $250.00 on which he pays the minimum due in January 25th but plans to pay it off during February. He has to pay $125 per pay period in child support for his 3 year son who lives with his mother. Instructions: Using the worksheets provided prepare a budget for Jan and Feb for Johnny Income Calculator GROSS INCOME Category Wages, Salary, Bonuses Interest Income Investment Income Other Income (e.g., child support, alimony) TAXES WITHHELD AND PAYMENT DEDUCTIONS Category Federal Income Tax State and Local Income Tax Social Security and Medicare Tax Employer Health Insurance Premium Employer Retirement Plan Contribution (e.g., 401k) Other TOTAL Category (Subtract taxes and deductions from gross income) Monthly Amount 1 Monthly Amount Monthly Amount Monthly Amount 2 Monthly Amount Monthly Amount 0 0 1 2 3 4 INCOME 5 Wages 6 Interest/dividends 7 Miscellaneous 8 Income totals 9 EXPENSES 10 Home 11 Mortgage/rent 12 Utilities 13 Home telephone 14 Cellular telephone 15 Home repairs 16 Home improvement 17 Home security 18 Garden supplies 19 Home totals 20 21 Daily living 22 Groceries 23 Child care 24 Dry cleaning 25 Dining out 26 Housecleaning service 27 Dog walker 28 Daily living totals 29 30 Transportation 31 Gas/fuel 32 Insurance 33 Repairs 34 Car wash/detailing services 35 Parking 36 Public transportation 37 Transportation totals 38 Personal budget Entertainment Video/DVD rentals Entertainment totals e O Cable TV 2 Movies/plays 3 Concerts/clubs 5 s Health 7 Health club dues B Insurance Prescriptions Over-the-counter drugs 1 Co-payments/out-of-pocket 2 Veterinarians/pet medicines 3 Life insurance 4 Health totals 5 6 Vacations 7 Plane fare 8 Accommodations 9 Food 50 Souvenirs 1 Pet boarding 52 Rental car 53 Vacations totals 64 55 Recreation 56 Gym fees 67 Sports equipment 38 Team dues 39 Toys/child gear 70 Recreation totals 71 B z D Dues/subscriptions Magazines Newspapers Internet connection Public radio Public television Religious organizations Charity Dues/subscription totals Personal Clothing Gifts 5 Salon/barber 5 Books Music (CDs, etc.) 3 Personal totals 9 O Financial obligations 1 Long-term savings 2 Retirement (401k, Roth IRA) 3 Credit card payments Income tax (additional) 5 Other obligations 6 Financial obligation totals 7 Misc. payments 9 Other 00 Other 01 Other 32 Other 03 Other 04 Misc. payments totals 05 06 Total expenses 07 Cash short/extra 08
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Answer rating: 100% (QA)
Johnnys gross income is 7600000 per year and he is paid on the 15th and the 30th of each The first month January his expenses are approximately 30 of ... View the full answer
Related Book For
Accounting Principles
ISBN: 978-0470533475
9th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Posted Date:
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