Unit 12
Accounting and Finance Foundations Unit 12: Budgeting and Business Plans 921
Budgeting and Business Plans Student Guide
27.4.3 Budget Exercise —High-School Graduate
Full-time Employee—40 hours per week
Income:
Gross Salary: $20,800 ($10/hour)
Net Salary (after taxes & health benefits): $16,000
Monthly Expenses:
- Rent for one-bedroom apartment: $425
- Phone: $45
- Natural gas: $20
- Electric: $20
- Internet access $19
- Car payment: $257 (Honda Civic; cost = $13,000; loan = 5 years @ 7% interest)
- Car insurance: $55
- Bank credit card: $75 (Balance = $1,900: interest = 15%; estimated time to pay off debt = 31 months—
paying minimum payment with no further charges) - Gasoline: $25
- Personal/Clothing: $30
- Hair cuts, magazines, etc.: $40
- Clothing store credit card: $40 (Balance = $800: interest = 21%; estimated time to pay off debt = 25
months—paying minimum payment with no further charges) - Groceries: $125
- Eating out: $15
- Recreation & entertainment: $100
- Cable: $45
- Savings: $0
(Pay yourself first!)
Chapter 27