The following table shows the expenses and income for a local college student. Assume that amounts shown for salaries and wages are after taxes and that 1 month = 4 weeks.
Income Expenses
Part-time job: $1400/month Rent: $500/month
Student loan: $6600/year Groceries: $40/week
Scholarship: $6000/year Tuition and Fees: $7500/year
Health Insurance: $50/month
Entertainment: $100/month
Phone: $40/month
a) What is the student's monthly income?
b) What is the student's monthly expenses?
c) What is the student's monthly cash flow?
To find the student's monthly income, we need to add up the different sources of income:
Income from part-time job: $1400/month
Income from student loan: $6600/year ÷ 12 months = $550/month
Income from scholarship: $6000/year ÷ 12 months = $500/month
Total monthly income = $1400/month + $550/month + $500/month = $2450/month
Therefore, the student's monthly income is $2450.
To find the student's monthly expenses, we need to add up the different expenses:
Rent: $500/month
Groceries: $40/week × 4 weeks = $160/month
Tuition and Fees: $7500/year ÷ 12 months = $625/month
Health Insurance: $50/month
Entertainment: $100/month
Phone: $40/month
Total monthly expenses = $500/month + $160/month + $625/month + $50/month + $100/month + $40/month = $1475/month
Therefore, the student's monthly expenses are $1475.
To find the student's monthly cash flow (the difference between income and expenses), we subtract the total expenses from the total income:
Monthly cash flow = Total monthly income - Total monthly expenses
= $2450/month - $1475/month
= $975/month
Therefore, the student's monthly cash flow is $975.