Question

Construct a personal income statment for the Humperdrienk family using the following information: salaries, $42,000; mortgage payment, $7,980; food, 2,400; interest income, $150; transportation, $1,200; dividend income, $190; automobile payment, $3,060; clothes and personal, $2,000; student loan payment, $1,700; property taxes, $9,700; and recreation and vacation, $2,000. What is thr family's disposable income ?

this subject is supposed to be Accounting for Entrepreneurship

* please explain your answer and right the formula , orgonize it but not too sophisticated .

Answer 1

Humperdrienk family

Personal Income Statement

Income	Amount(in $)
Salaries	42,000
Interst Income	150
Dividend income	190
TOTAL INCOME	$42,340
Fixed Expenses
Mortgage payment	7,980
Automobile payment	3,060
Student loan payment	1,700
Property taxes	9,700
TOTAL FIXED EXPENSES	$22,440
Variable Expenses
Food	2,400
Transportation	1,200
Clothes and personal	2,000
Recreation and vacation	2,000
TOTAL VARIABLE EXPENSES	$7,600
TOTAL EXPENSES (FIXED + VARIABLE)	$30,040
PROFIT (TOTAL INCOME - TOTAL EXPENSES)	$12,300

Income Statement represents cash inflows that are income, cash outflows that are expenses and the difference between the two gives profit. Inflows are salaries, interest income, dividend income on securities. Outflow consists of fixed and variable expenses.