AnswersKapuschinskyWCA 3424 Consumer Applications 1st nine weeks 26-27Personal BudgetQuestion 2
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Personal Budget

Question 2 • (Kapuschinsky)WCA 3424 Consumer Applications 1st nine weeks 26-27

Alexa has finished her culinary training program and is now working full-time as a chef in a hotel resort restaurant. She has tripled her salary from when she was working part-time to pay her expenses through school. How should this increased income affect her budget? Make comparisons with her previous budget and her current budget. Monthly Budget Previous Budget Current Budget Income Wages $800 $2400 Expenses Rent Utilities Groceries Savings Bus Pass $300 $60 $200 $100 $30 $300 $60 $250 $150 $30 Net Income $110 $1610

Answer
A
Alexa is earning quite a bit more money and her expenses reflect the change in income.
B
Alexa is earning quite a bit more money than she was previously. She has worked hard and deserves to spend a lot of money on herself.
C
Alexa is earning quite a bit more money than she was previously. This would be a good time for her to re-evaluate her budget. Part of the extra money she is making could be put in her savings account.
D
Her increased income should have no effect on her financial decisions.

Explanation

Alexa’s monthly income rose from $800 to $2,400, an increase of $1,600. Her expenses rose from $690 to $790, while her savings increased only from $100 to $150, so she now has $1,610 in net income. She should re-evaluate her budget and consider putting more of her extra income into savings. This matches choice c.

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