SECTION 3-2 pp. 149-152 Preparing a Budget Sheet

Section Objective Use: records of past expenditures to prepare a monthly budget sheet

Key Words to Know living expenses (p. 149) Routine expenses, such as food, utilities, and clothing, that vary from month to month. fixed expenses (p. 149) Regular expenses that do not vary from month to month, such as rent and car payment.

Key Words to Know annual expenses (p. 149) Expenses which occur once a year, such as insurance premiums and real estate taxes.

Formula Total Monthly Monthly Monthly Share Monthly = Living + Fixed + of Annual Expenses Expenses Expenses Expenses

A Rock Star’s Lyrical Leverage p. 149 Why do you think Classified’s expenses were highest last summer?

Example 1 The Millers use records of their past expenditures to complete the budget sheet shown on page 150 in your textbook. What is the total of their monthly expenses?

Example 1 Answer Step: Find the total monthly expenses. Monthly Monthly Monthly Share Living + Fixed + of Annual Expenses Expenses Expenses $505.00 + $978.50 + $219.29 = $1,702.79

Example 2 The Browns have monthly living expenses of $875.00, monthly fixed expenses of $1,025.80, and annual expenses of $4,974.00. After calculating the Browns’ monthly share of annual expenses, find their total monthly expenses.

Example 2 Answer: Step 1 Find the monthly share of annual expenses.            12 $4,974 = $414.50     12

Example 2 Answer: Step 2 Add up the expenses. Monthly      Monthly         Monthly Share Living    +    Fixed       +    of Annual Expenses    Expenses       Expenses $875.00 + $1,025.80 + $414.50 = $2,315.30

Practice 1 Find the total monthly expenses. Living: $846 Fixed: $1,560 Annual expenses: $4,644

Practice 1 Answer $2,793.00

Practice 2 Find the total monthly expenses. Living: $638 Fixed: $972 Monthly share of annual expenses: $4,980

Practice 2 Answer $2,025.00

END OF SECTION 3-2 Preparing a Budget Sheet