Question
Just after graduation, you have joined ABC Financial Advisors as a Paraplanner. Your first job is to prepare basic financial statements and analyse the financial
Just after graduation, you have joined ABC Financial Advisors as a Paraplanner. Your first job is to prepare basic financial statements and analyse the financial situation of a client. The prepared Fact Sheet based on information provided by the client reveals the following information. The client, Ms Rae Adams, is employed as a Management Trainee at YZ Manufacturing. Her gross salary for the 2016 financial year was $72,000. In addition, the employer contributes 9.5% of her gross salary into a personal superannuation fund. Ms Adams' total tax liability in 2016 is $14,947.00. In addition, she received non-taxable rental income of $200 and tax-free interest income of $190.Ms Adams has contributed $5,200 to her personal superannuation account. She paid union fees of 1% of her gross salary and $1,080 in healthcare expenses. Ms Adams' household and entertainment expenses were $12,250 and $8,500 in 2018, respectively. Also, Ms Adams paid $15,500 against the mortgage loan and another $6,500 for a credit card loan.Ms Adams has her own home which is worth $650,000. A month ago, her contents were valued by her insurer for $150,000. Furthermore, she has a car worth $25,000 and a savings account balance of $8,000. Her accumulated superannuation balance as of the end of 2016 was $155,000. The outstanding balances on the mortgage loan and credit card were $350,000 and $10,000 respectively.
Requireda) Using the above financial data, prepare the following information for Ms Rae Adams:
i. personal balance sheet;(6 marks)ii. personal cash flow statement; (10 marks)iii. Net Worth Ratio;(2 marks)iv. Quick Ratio;(2 marks)v. Savings Ratio; (2 marks)vi. Debt Service Ratio. (2 marks)
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