Question

Construct Financial Statements

Thomas Green, of Laramie, Wyoming, has been a retail salesclerk for six years. At age 35, he is divorced with one child, Amanda, age 7. Thomas' salary is $46,000 per year. He regularly receives $500 per month for child support from Amanda's mother. Thomas invests $100 each month ($50 in his mutual fund and $50 in U.S. savings bonds).

ASSETS	Amount
Vested retirement benefits (no employee contribution)	$ 6,000
Money market account (includes $150 of interest earned last year)	5,000
Mutual fund (includes $200 of reinvested dividend income from last year)	5,000
Checking account	1,000
Personal property	6,000
Automobile	12,500
U.S. savings bonds	3,000
LIABILITIES	Outstanding Balance
Dental bill (pays $25 per month and is included in uninsured medical/dental)	$    450
Visa (pays $100 per month)	3,500
Student loan (pays $100 per month)	9,000
ANNUAL FIXED EXPENSES	Amount
Auto insurance	$    780
Rent	12,000
Uninsured medical/dental	1,000
Federal income tax	5,600
Social Security taxes	3,500
Health insurance	2,440
ANNUAL VARIABLE EXPENSES	Amount
Dry cleaning	$    480
Utilities	2,400
iPhone	980
Cable	1,400
Internet	800
Food	3,000
Personal care	420
Gas, maintenance, license	2,120
Clothes	500
Entertainment	2,500
Vacations/visitation/travel	3,100
Child care	4,990
Gifts	400
Miscellaneous	300

Using the information above, construct a balance sheet and a cash-flow statement for Thomas. Round monetary values to the nearest dollar and percentage values to two decimal places.

Balance Sheet for Thomas Green
		Dollars				Percent
ASSETS
Monetary Assets
Checking account		$				%
Money market account						%
U.S. savings bonds						%
Total Monetary Assets				$				%
Tangible Assets
Personal property		$				%
Automobile						%
Total Tangible Assets				$				%
Investment Assets
Mutual fund		$				%
Vested retirement benefits						%
Total Investment Assets				$				%
TOTAL ASSETS				$				%
LIABILITIES
Short-Term Liabilities
Dental bill		$				%
Visa						%
Total Short-Term Liabilities				$				%
Long-Term Liabilities
Student loan		$				%
Total Long-Term Liabilities				$				%
TOTAL LIABILITIES				$				%
NET WORTH				$				%
TOTAL LIABILITIES AND NET WORTH				$				%

Cash-Flow Statement for Thomas Green
		Dollars				Percent
INCOME
Thomas' salary		$				%
Child support						%
Interest and dividends						%
TOTAL INCOME				$				%
EXPENDITURES
Fixed Expenses
Rent		$				%
Mutual fund						%
U.S. savings bond						%
Health insurance						%
Auto insurance						%
Uninsured medical/dental						%
Taxes						%
Debt payments						%
Total Fixed Expenses				$				%
Variable Expenses
Food		$				%
Utilities						%
iPhone						%
Cable						%
Internet						%
Gas, maintenance, license						%
Dry cleaning						%
Personal care						%
Child care						%
Clothes						%
Entertainment						%
Vacation/visitation/travel						%
Gifts						%
Miscellaneous						%
Total Variable Expenses				$				%
TOTAL EXPENSES				$				%
NET GAIN				$				%

Answer 1

Balance Sheet for Thomas Green
	Dollars		Percent
ASSETS
Monetary Assets
Checking account	$   1,000.00		2.60%
Money market account	$   5,000.00		12.99%
U.S. savings bonds	$   3,000.00		7.79%	23.38%
Total Monetary Assets		$   9,000.00
Tangible Assets
Personal property	$   6,000.00		15.58%
Automobile	$ 12,500.00		32.47%	48.05%
Total Tangible Assets		$ 18,500.00
Investment Assets
Mutual fund	$   5,000.00		12.99%
Vested retirement benefits	$   6,000.00		15.58%	28.57%
Total Investment Assets		$ 11,000.00		100.00%
TOTAL ASSETS		$ 38,500.00
LIABILITIES
Short-Term Liabilities
Dental bill	$      450.00
Visa	$   3,500.00
Total Short-Term Liabilities		$   3,950.00
Long-Term Liabilities
Student loan	$   9,000.00		23.38%
Total Long-Term Liabilities		$   9,000.00		23.38%
TOTAL LIABILITIES		$ 12,950.00		33.64%
NET WORTH		$ 25,550.00		66.36%
TOTAL LIABILITIES AND NET WORTH		$ 38,500.00		100.00%
Cash-Flow Statement for Thomas Green
	Dollars		Percent
INCOME
Thomas' salary	$ 46,000.00		87.87%
Child support (500 x 12)	$   6,000.00		11.46%
Interest and dividends (150 +200)	$      350.00		0.67%
TOTAL INCOME		$ 52,350.00		100%
EXPENDITURES
Fixed Expenses
Rent	$ 12,000.00		22.92%
Mutual fund (12 x $50)	$      600.00		1.15%
U.S. savings bond (12 x $50)	$      600.00		1.15%
Health insurance	$   2,440.00		4.66%
Auto insurance	$      780.00		1.49%
Uninsured medical/dental	$   1,000.00		1.91%
Taxes (5600 +3500)	$   9,100.00		17.38%
Debt payments ( 100 + 100) x 12 months	$   2,400.00		4.58%
Total Fixed Expenses		$ 28,920.00		55.24%
Variable Expenses
Food	$   3,000.00		5.73%
Utilities	$   2,400.00		4.58%
iPhone	$      980.00		1.87%
Cable	$   1,400.00		2.67%
Internet	$      800.00		1.53%
Gas, maintenance, license	$   2,120.00		4.05%
Dry cleaning	$      480.00		0.92%
Personal care	$      420.00		0.80%
Child care	$   4,990.00		9.53%
Clothes	$      500.00		0.96%
Entertainment	$   2,500.00		4.78%
Vacation/visitation/travel	$   3,100.00		5.92%
Gifts	$      400.00		0.76%
Miscellaneous	$      300.00		0.57%
Total Variable Expenses		$ 23,390.00		44.68%
TOTAL EXPENSES		$ 52,310.00		99.92%
NET GAIN		$        40.00		0.08%