Answer:
C
Explanation:
First, we need to calculate the net income after deductions:
FICA = 7.65% x $4,520.00 = $346.38
Federal tax withholding = 11.75% x $4,520.00 = $531.40
State tax withholding = 8.5% x $4,520.00 = $384.20
Total deductions = $346.38 + $531.40 + $384.20 = $1,262.98
Net income = $4,520.00 - $1,262.98 = $3,257.02
Next, we need to calculate the amount allocated for fixed expenses:
Fixed expenses = 30% x $3,257.02 = $977.11
The remaining amount that is available for savings is:
Savings = $3,257.02 - $977.11 = $2,279.91
The emergency fund is equal to 5 months' worth of fixed expenses, which is:
Emergency fund = 5 x $977.11 = $4,885.55
The amount placed in the CD is 75% of the emergency fund, which is:
CD = 75% x $4,885.55 = $3,664.16
The amount placed in the regular savings account is:
Savings account = $4,885.55 - $3,664.16 = $1,221.39
To calculate the interest earned in the CD in 60 days, we use the formula:
Interest = Principal x Rate x Time
where the rate is annual percentage rate (APR) divided by 365 (number of days in a year)
Interest earned in the CD = $3,664.16 x (5.25%/365) x 60 = $21.97
To calculate the interest earned in the regular savings account, we use the formula:
Interest = Principal x Rate x Time
where the rate is annual percentage yield (APY) divided by 365 (number of days in a year)
Interest earned in the regular savings account = $1,221.39 x (3.8%/365) x 60 = $17.30
Therefore, the total interest earned between both accounts in 60 days is:
$21.97 + $17.30 = $39.27
So the correct answer is (c) $39.27.