Chapter $2$

Financial Planning Exercise $4$

Preparing income and expense statement.

Use Worksheet $2\mathrm{.}2$ Bill and Nancy Ballinger are about to construct their income and expense statement for the year ending December $31,2017.$ Bill is finishing up college and currently has no income. They have put together the following income and expense information for $2017$:

Nancy's salary $$43,000$

Reimbursement for travel expenses $1,900$

Interest on:

Savings account $110$

Bonds of Alpha Corporation $70$

Groceries $4,150$

Rent $9,400$

Utilities $960$

Gas and auto expenses $650$

Bill's tuition, books, and supplies $3,300$

Books, magazines, and periodicals $280$

Clothing and other miscellaneous expenses $2,800$

Cost of photographic equipment purchased with charge card $2,200$

Amount paid to date on photographic equipment $1,600$

Nancy's travel expenses $1,950$

Purchase of a used car $($cost$)9,750$

Outstanding loan balance on car $7,300$

Purchase of bonds in Alpha Corporation $4,900$

Using the information provided, prepare an income and expense statement for the Ballingers for the year ending December $31,2017($follow the form shown in Worksheet $2\mathrm{.}2).$ Enter all expense amounts as positive values.

INCOME AND EXPENSE STATEMENT

Name$($s$)$ Bill and Nancy Ballinger

For the year Ended December $31,2017$

INCOME

Wages and salaries Name: Nancy

$ fill in the blank $1$

Name:

Name:

Self$-$employment income

Bonuses and commissions

Investment income Interest received

$ fill in the blank $2$

Dividends received

Rents received

Sale of securities

Other

Pensions and annuities

Other income Reimbursement for travel expenses

$ fill in the blank $3$

$($I$)$ Total Income

$ fill in the blank $4$

EXPENSES

Housing Rent$/$mortgage payment $($include insurance and taxes, if applicable$)$

$ fill in the blank $5$

Repairs, maintenance, improvements

Utilities Gas, electric, water

$ fill in the blank $6$

Phone

Cable TV and other

Food Groceries

$ fill in the blank $7$

Dining out

Transportation Auto loan payments

$ fill in the blank $8$

License plates, fees, etc.

Gas, oil, repairs, tires, maintenance

$ fill in the blank $9$

Medical Health, major medical, disability insurance $($payroll deductions or not provided by employer$)$

Doctor, dentist, hospital, medicines

Clothing Clothes, shoes, and accessories

$ fill in the blank $10$

Insurance Homeowner's $($if not covered by mortgage payment$)$

Life $($not provided by employer$)$

Auto

Taxes Income and social security

Property $($if not included in mortgage$)$

Appliances, furniture, and other major purchases Loan payments

$ fill in the blank $11$

Purchases and repairs

Personal care Laundry, cosmetics$,$ hair care

Recreation and entertainment Vacations

Other recreation and entertainment

$ fill in the blank $12$

Other items Bill's tuition, books, and supplies

$ fill in the blank $13$

Alpha Corp. bonds

$ fill in the blank $14$

Travel expenses

$ fill in the blank $15$

$($II$)$ Total Expenses

$ fill in the blank $16$

CASH SURPLUS $($OR DEFICIT$)[($I$)-($II$)]$

$ fill in the blank $17$