Question

Tristan has found a good job as a bookkeeping clerk after finishing his associates degree at the local community college. He is making a beginning annual salary of $19,760. How can this increased income affect his financial decisions? Compare his previous budget when he worked part time while finishing his degree with his current budget after getting a full time job.

Monthly budget | Previous Budget | Current Budget

income
Wages | $786 | $1646

Expenses
Rent | $300 | $600
Utilities | $60 | $120
Groceries | $130 | $200
Savings | $120 | $350
Car Expenses | $150 | $150
Entertainment | $20 | $120

Net Income | $6 | $106

a.Tristan is spending too much money on groceries and entertainment.

b.Tristan is earning quite a bit more in his full time job. He is spending more on rent, utilities, food, and entertainment, as well as saving $350 each month.

c.Tristan is earning double his previous wages. He should double his expenses, as well.

d.Tristan's increased income should have no effect on his financial decisions.

Answer 1

B. Tristan is earning quite a bit more in his full time job.

Answer 2

The increased income is affecting Tristan's financial decisions as now he is spending more as well as saving more.

The correct answer is option B.

Tristan is earning quite a bit more in his full time job. He is spending more on rent, utilities, food, and entertainment, as well as saving $350 each month.