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Required: (a) Prepare an income statement for last year (2016) for the Gruber family. Assume that they had no taxes owing or refunded. (b)
Required: (a) Prepare an income statement for last year (2016) for the Gruber family. Assume that they had no taxes owing or refunded. (b) Prepare a balance sheet as of the end of last year for the Gruber family. (c) Prepare a monthly cash budget for the period of January to December of this year (2017). State clearly any assumptions you make. (d) Comment on the Gruber family's current situation with regard to their cash budget and make recommendations on what they should do with respect to their current spending and saving habits. Discuss all the issues that you feel are relevant to the Gruber family's financial situation, including plans they should be making to meet reasonably anticipated future expenditures and expenses. How realistic is their desire to buy a larger house? It's New Year's Day, 2017, and John and Julie Gruber have decided to be more careful with how they spend their money. Lately, they have realized that they are merely going from pay cheque to pay cheque. They want to look seriously at their financial situation and put themselves on a budget. "At the rate we're saving, we'll be 90 years old before we can retire!" says Julie. They have two children, Jenny, 6 years old, and Ross, 2 years old. They are planning to have another child in a year or so, and they would also like to buy a larger home. The Gruber family have come to you for advice and have provided you with the following information: John is a production manager in a small manufacturing firm 1. 11. 111. His annual salary is $75,000. His net bi-weekly pay after payroll deductions is $2,800. Julie has a part-time job as a legal secretary and makes about $300 a week after deductions. Her gross annual salary is $18,700 The younger child stays in a home day care in the neighbourhood, at a cost of $115 per week. They have a chequing account which is used to pay all their household bills and from which draw their pocket money. The balance in the account at the end of December is $400.
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