online.hccs.edu/courses/54291/quizzes/209019 George and Betty, a middle-aged cou
ID: 2509081 • Letter: O
Question
online.hccs.edu/courses/54291/quizzes/209019 George and Betty, a middle-aged couple, have watched their savings account dwindle over the years. They both make good incomes and can't understand why they aren't saving more each month. Below is their financial information to complete an income statement. Gross monthly income: $8,000 Income taxes withheld monthly: $2.300 Monthly interest income from investments: $100 Monthly insurance payments: $700 Monthly housing expenses: $4,500 Monthly food expenses: $s800 Miscellaneous expenses: $400 What is their current savings ratio?Explanation / Answer
Gross Income $8000
Less: income tax withheld ($2300)
Net Income $5700
Add; Income from investment $100
Total income $5800
Less: Expenses:
Insurance ($700)
Household exps ($4500)
Food exps ($800)
Mis Exps ($400)
Net Savings - 600
Saving Ratio = Saving/ Gross Income
-600/8000 = -0.075
In this case saving ratio is negative
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.