Constants section values

Salary increase factorYour uncles salary as of the current working year just ended (Year 0) is $80,000. As you can see, raises are expected each year; for example, a 3 percent raise is expected in the upcoming year (Year 1). If your uncle does not retire in a year, he will get his salary (including a raise) for the year.

Part-time wages expectedFor the next three years, your uncle has estimated his part-time wages in a year that he is retired from the company and working part-time (Years 1 to 3). For example, he thinks he could earn $10,000 in part-time wages in Year 1 if he retired.

Buyout amountThe amounts for the companys preretirement buyout plan are shown. For example, if your uncle retires now (and does not work for the company in Years 1 through 3), he gets $45,000, $30,000, and $10,000 in Year 1 through Year 3. If he works another year, then leaves before Year 2 starts, he will give up the $45,000 payment for Year 1 but will get $30,000 and $10,000 in Year 2 and Year 3.

Cost of living (not retired)Your uncle has estimated how much cash he needs to meet his living expenses, assuming he continues to work for the company. His cost of living would be $41,000 in Year 1, increasing each year thereafter.

Country club duesCountry club dues will be $12,000 for Year 1. Dues increase each year thereafter, as shown

I have to fill in the cells according to the information next to each header under each section.

Summary of Key Results Section

Each years End-of-year cash on hand value is echoed from cells in the spreadsheet body.

Input Section

Retired or WorkingEnter an R if your uncle would be retired in the year or a W if he would still be working. If he is working the next three years, you should enter the pattern WWW. If he plans to retire now (that is, not work Year 1), you would enter the pattern RRR. If he works for one year and then retires, you should enter the pattern WRR.

Stay in club?If your uncle stays in the club, you should enter a Y. If your uncle leaves the club now, you should enter an N. The decision applies to all years

Calculations Section

Tax rateYour uncles tax rate depends on whether he is retired. Retired people have lower overall tax rates. If he is retired in a year, your uncles rate is expected to be 15 percent of income before taxes. In a year in which he works full time, the rate will be 30 percent.

Cost of livingIn any year that your uncle continues to work for the company, his cost of living is the amount shown in the Cost of living (not retired) field of the Constants section in Figure C-21. But, if he chooses to retire, his cost of living will be $15,000 less than the amount shown in Figure C-21.

Yearly salary or part-time wagesIf your uncle keeps working, his salary increases each year. The yearly percentage increases are shown in the Constants section. Thus, salary earned in Year 1 would be 3 percent more than that earned in Year 0, salary earned in Year 2 would be 3 percent more than that earned in Year 1, and salary earned in Year 3 would be 2 percent more than that earned in Year 2. If your uncle retires in a certain year, he will make the part-time wages shown in the Constants section.

Country club dues paidIf your uncle leaves the club, the dues are zero each year; otherwise, the dues are as shown in the Constants section.

Income Statement and Cash Flow Statement Section

Beginning-of-year cash on handThis amount is the cash on hand at the end of the prior year. Note that cash on hand at the end of the current year is $30,000.

Salary or wagesThis amount is a yearly calculation, which can be echoed here.

Buyout incomeThis amount is the years buyout amount if your uncle is retired that year. Buyout amounts are shown in the Constants section.

Total cash inflowThis amount is the sum of salary or part-time wages and the buyout amount.

UNCLE (version 1) a Search Sheet Home Insert Page Layout Formulas Data Review View Developer Share ^ Show Detail 2 From From New Database Refresh Sort Filter ', Advanced Text to Flash Remove Data Consolidate what-tf Group Ungroup SubtotalDE Hide Detail Data Solver Columns Fill Duplicates Validation YearYear 1 Year 2Year 3 0.03 4 Part-time wages expected tretred) 10,000 $10.200 $10.500 $45,000 $30,000 $10.000 $41,000 $42.000 $43.000 12,000 $13,000 $14,000 11 Stay in club?or N 13 Summary of Key Results Year Year1 Year2 Year3 Year Year1 Year 2 Year 3 0.30 $26,000 $42.000 $28.000 $80,000 $10,000 $10300 $10,500 $12,000 $13.00D $14.000 Income Statement and YearQ Ya Year Year3 23 Beginning-ot-year cash on hand $10,000 $82.40D $1D,000 $55,000 $40.200 $20,500 12,000 $13.000 $14,000 10,000 $10.200 $10,500 $38,00055,000 $42,000 28 Country club dues paid 35 End-of-year cash on hand .. + 100%