Question

Case 10.63 a1

In this chapter, you learned about the benefits of budgeting for a business. It is also important for individuals, especially students. Jo is an accounting major. Jo’s estimate of expenses for the next eight-month academic year (September to May) are given in the chart below. Jo receives $750 per month from family members, Annually, Jo gets a total of $700 from a part-time job and $1,200 from a bursary.

Tuition and fees		$6,200		Books and supplies		$1,500
Residence and food		9,200		Internet connection		295
Local travel (included with student fees)		0		Travel home		400
Clothing		400		Personal sundries		560
Entertainment and going out		424		Misc.		420

(a1)

Prepare a budget for Jo. and calculate the shortfall.

Answer 1

Budgeting involves the estimation of Incomes and Expenditure of the near future.

Accordingly for jo. as a student Budgeting is very important. The shortfall in the budget is calculated as follow:

Particulars	Amount
Budgeted Income:
Received from Family members (8*750per month)	6000
Annual Receipt from Part time job ( for 8 months = 700/12*8)	466.7
Receipt from Bursary ( for 8 months = 1200/12*8)	800
Budgeted Income for next 8 months	$7,267
Budgeted expenditure:
Tution and fees	6200
Residence and Foood	9200
Local Travel (Included in Fees)	0
Clothing	400
Entertainment and going out	424
Books and supplies	1500
Internet connections	295
Travel Home	400
Personal Sundries	560
Misc.	420
Budgeted Expenditure for next 8 months	$19,399
Shortfall In the budget	($12,132)