Math 101 Creating A Hypothetical Budget Portfolio

Creating a Hypothetical Budget – Portfolio Activity

Expense	Amount
Rent (monthly)	$657.00
Telephone (monthly)	$56.34
Groceries (weekly)	$56.00
Clothing (monthly with ½ job related)	$106.00
Water & Electric (monthly)	$98.87
Weekly Dinner & Movie	$40.00

You are paid $11.75/hr. You work 40 hr/wk. Your deductions are FICA (7.65%), Federal tax withholding (10.75%), and state tax withholding (7.5%)

1. Assuming you budget a month as 4 weeks, how much is your total realized income, fixed expenses, and discretionary expenses. $1,549.56

2. If you are able to work 20 hours of overtime the next month and are paid 1.5 times your regular rate, how does this change your budget for that month? $2,324.32

3. How much can you put towards savings each month if you eliminated your discretionary expenses? $258.87

   Be sure to include in your response:

   • A detailed budget showing income and expenses for the two different months.

   • Answers to the original questions.

   • An explanation for how you calculated the first 40 hours of income and then the additional 20 hours of overtime.

Month 1

Realized Income:	Amount
11.75/hr, 40 hrs a week	$470
tax deductions, 7.65%, 10.75%	$387.39
Total Income	$1,549.56
Expense (Fixed):	Amount
Rent	$657.00
Telephone	$56.34
Water and electricity	$98
groceries	$224
Total Expenses (Fixed)	$1,035.50
Expense (Discretionary):
weekly dinner/movie	$160
clothing	$98.87
Total Expenses (Discretionary)	$258.87

Total Expenses (Fixed & Discretionary):

1,294.37

Month 2

Realized Income:	Amount
11.75/hr, 40hr/week, plus 20/hr	$705
tax deductions	581.08
Total Income	2,324.32
Expense (Fixed):	Amount
rent	$1,314
telephone	112.68
water and electricity	196
groceries	448
Total Expenses (Fixed)	2,070.68
Expense (Discretionary):
weekly dinner/movie	320
clothing	197.74
Total Expenses (Discretionary)	517.74
Total Expenses (Fixed & Discretionary):	2,588.42