Budgeting Examples

For each of the following scenarios, indicate whether the individual made a correct choice or an incorrect choice when preparing a budget.

Correct Choice

Incorrect Choice

David is a sales rep who, based on last year, averaged $$2,500$ of monthly commission before taxes. He should include this in his budget.

Sharon was just notified that her contribution to the company$$s health plan is increasing by $3\mathrm{.}5\%.$ It$$s a company expense, so Sharon doesn$$t include it in her budget.

As Scott was reconciling his checkbook, he realized that he incurred $$15\mathrm{.}75$ last month for ATM withdrawals. He looked back at the last six months and realized that he averaged the same amount each month. This is an unexpected expense and shouldn$$t be listed in his budget.

Every year the Mendozas buy a big item or take a trip with a single annual bonus Jesse receives. They included this in their budget.