Continuing Case 15. Personal Balance SheetJamie Lee Jackson, age 24, now a busy full-time college student and part-time bakery clerk, has been trying to organize all of herpriorities, including her budget. She has been wondering if she is allocating enough of her income towards savings, which includesaccumulating enough money towards the $10,500 down payment she needs to begin her dream of opening a cupcake café.Jamie Lee has been making regular deposits to both her regular, as well as her emergency savings account. She would really like to sitdown and get a clearer picture of how much she is spending on various expenses, including rent, utilities, entertainment and how herdebt compares to her savings and assets. She realizes that she must stay on track and keep a detailed budget if she is to realize herdream of being self-employed after college graduation.Use the details below to complete Jamie Lee's personal financial plan to determine her financial position. Each answer must have avalue for the assignment to be complete. Enter "O" for any unused categories.Current Financial SituationAssets:Checking accountEmergency fund savings accountCarComputer & iPadLiabilities:Student loanCredit card balanceIncome:Gross monthly salaryNet monthly salarySavings allocation:Regular savingsRainy day savingsMonthly Expenses:$2,150 Rent obligation$255$4,900 Utilities/electricity$105$5,800 Utilities/water$65$1,400 Utilities/cable TV$150Food$145$7,200 Gas/maintenance$125$1,300 Credit card paymentCar insurance$75$75$2,455 Clothing$75$2,030 Entertainment:Cake decorating class$45$160 Movies with friends$80$30 Household assets and possessionsCurrent market value of homeMarket value of automobilesFurnitureComputer, electronics, cameraJewelryOtherTotal household assets$690

Total assets refers to the total amount of assets possessed by a person or business. Assets are…

Answered: Jamie Lee Jackson, age 24, now a busy…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Theadre Adams wants to open an accounting firm once she gets out of college in 4 years. She has determined that in order to open up her business she would need $160,000.00. She has determined that she would need a $30,000 down payment. The $160,000 would go towards paying out on a monthly basis a total of 4 years. What would her annuity payment be monthly in order to raise the money if she saves at an institution that offers 5.5% interest on deposit? If the same financial institution would then offer 8% on deposit over 48 months, what is the monthly payout of the annuity that she will use for her business’ monthly expenses?
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Suppose that you need $30,000 for your last year of college. You could go to a private lending institution and apply for a signature student loan; rates range from 7% to 14%. However, your Aunt Sally is willing to loan you the money from her retirement savings, with no repayment until after graduation. All she asks is that in the meantime you pay her each month the amount of interest that she would otherwise get on her savings (since she needs that to live on), which is 4%.What is your monthly payment to her, and how much interest will you pay her over the year (9 months)?(Fill in the blanks below and give your answers as whole numbers.)The amount of interest per month you would pay Aunt Sally is $__(1)__ .The total interest you will pay her over the year (9 months)is $__(2)__ .
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Should this person open a credit card account? If they do decide to open the new credit card account, what’s one thing this individual should monitor?
Ms. Khan is preparing for her daughter's future wedding expenses. Her daughter is currently 15 years old, and Ms. Khan estimates that she will need $80,000 for the wedding when her daughter turns 23. (a) How much will she have to set aside today if the annual interest rate is 5% and the bank compounds it quarterly? (b) How much will she have to set aside today at the same rate if the bank compounds it daily? (c) Explain the difference in your answers above.
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Lynn Swartz's husband died 3 years ago. Her parents, who have income of over $200,000 per year, want to ensure that funds will be available for the education of Lynn's eight-year-old son, Eric. Lynn is currently earning $45,000 a year. Lynn's parents have suggested that they start a savings account for Eric. They have calculated that if they invest $4,000 per year for the next 8 years, sufficient funds will be available at the end of 10 years for Eric's college expenses. Lynn realizes that the tax treatment of the investments could significantly affect the amount of funds available for Eric's education. Complete the letter advising her about options available to her parents and to her for Eric's college education. SWFT, LLP 5191 Natorp Boulevard Mason, OH 45040 September 7, 2021 Ms. Lynn Swartz 100 Myrtle Cove Fairfield, CT 06824 Dear Lynn: You asked me to consider the tax-favored options for accumulating the funds for Eric's college education. An added complication (and opportunity…

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