Unit 12
Accounting and Finance Foundations Unit 12: Budgeting and Business Plans 918
Budgeting and Business Plans Student Guide
27.4.1 Budget Exercise —College Graduate
Full-time Employee—40 hours per week
Income:
Gross Salary: $31,200 ($15/hour)
Net Salary (after taxes & health benefits): $24,000
Monthly Expenses:
- Savings: $50 (Pay yourself first!)
- Rent for two-bedroom apartment: $575
- Phone: $45
- Natural gas: $20
- Electric: $25
- Car payment: $407 (Toyota 4Runner; cost = $27,000; loan = 7 years @ 7% interest)
- Student loans: $182 (In 2012, the average outstanding student loan balance was $23,300.)
- Car insurance: $75
- Gasoline: $50
- Groceries: $130
- Eating out: $20
- Direct TV: $55
- Internet access: $20
- Clothing: $50
- Recreation & entertainment: $120
- Personal expenses: $20
- Dry cleaning, haircuts, etc.: $40
- Bank credit card: $25 (Balance = $1,000; interest = 11%; estimated time to pay off debt = 49
months—paying minimum payment with no further charges) - Furniture store credit card: $50 (Balance = $1,250; interest = 21%; estimated time to pay off debt =
33 months—paying minimum payment with no further charges)
Chapter 27