Question

If a finance professional recommends that you save 10% of your income each month and Julie spends 30% on rent and 40% on all other fixed expenses, what percentage of income should she use on the rest of her expenses?

10%


20%


30%


40%

Answer 1

The percentage of income she should use on the rest of her expenses=20%

Explanation:

Step 1: Determine her total income

Let her total percentage income be =100%

Step 2: Determine amount of each expense

The amount of each expense can be expressed;

Amount of each expense=percentage of total expense×total income

a). Savings

percentage expense on savings=10%

b). Rent

percentage expense on rent=30%

c). Fixed expenses

percentage expense on fixed expenses=40%

d). The rest expenses

percentage expense on the rest=x

Step 3: Calculate total percentage income

Total percentage income=percentage on savings expenses+percentage on rent expenses+percentage on fixed expenses+remainder

replacing;

Total expenses=(10+30+40+x)=x+80

Total percentage income=100%

Step 4: Get remaining percentage amount of her income

(100)=(x+80)

x=100-80

x=20

The percentage of income she should use on the rest of her expenses=20%