FINC2603 Review Questions

You will create a series of budget sheets. The Excel Quick Reference Guide is available to assist with navigating the spreadsheets. 

The spreadsheet is created for you to complete with personal financial decisions. Each budget assignment file has two spreadsheets: a sample and a student worksheet. Do not copy the amounts from the sample, it is not based on the same requirements as your assignment. It is only a sample of what the completed spreadsheet is supposed to look like and how it should balance. Do not add any information to the cells highlighted in yellow, they contain formulas that will do the math for you.

All of the budget assignments will be based on the following parameters:

• Single 28 year old
• Annual gross income = $45,000
• Annual take-home (after taxes) = $38,250
• Monthly take-home (after taxes) = $3,187.50
• Savings – Emergency Fund $12,000
• Single person household
• Renting a home or apartment
• Own one automobile

While these parameters are set, there are still many other budget line items that must be researched and determined by you. These other items are to be based on your individual spending needs and habits. The goal is that you will gain an understanding of the impact of each spending action on the overall budget and the need to closely manage personal financial decisions.

The evaluation of each budget sheet is based on your:

• Attention to detail.
• Consistency across all spreadsheets.
• Application of financial decision-making as presented by the course text.
• Creating a budget with reasonable expenses that do not exceed income.

Income and Expense Statement

This week will be the process of building the Income and Expense Statement. Worksheet 2.2 in the text is an example. Chapter 2, ‘Preparing the Income and Expense Statement’ also provides information on this statement.

The Income and Expense Statement is annual income and expenses. It provides a strong picture of personal financial health. It also begins the process of collecting data that will be needed for the Week 4 Balance Sheet.

Go back to the detailed Monthly Cash Flow and determine the annual costs. The goal is that the detail of your budgeting process is increasing as we go back to an annual statement.

The additional parameter to add this week is life Insurance. Identify the:

• Type of life insurance: term or whole
• Policy amount
• Monthly premiums

It is important to note that you cannot have a deficit (negative amount) on the Income and Expense Statement for his class assignment.  If you have a deficit, eliminate optional expenses, or add a second job to the income.

Your grade will be determined according to the Budget Rubric embedded in this assignment.

When you are ready for your instructor to evaluate your work, save your file in its original format (no PDF without instructor approval) as FINC2603_YourName_Budget3 to your computer. Upload and submit the file to this assignment.

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