I know this is long but I would appreciate if anyone with accounting/finance knowledge could help out.
Your clients are a couple who are both 40 years old and have 2 kids. Don has an annual income of $90,000 ($2284.62 per fortnight after tax). Beth earns $40,000 per annum ($1200 per fortnight after tax). They are both contributing 4% of their income to a retirement plan.
They have cars worth $12,500 and $16,000 respectively. The interest rate on both is 13.95% with repayment over 5 years. They purchased a house for $555,000 with a 70% mortgage at 5.75% interest with a repayment period of 25 years. Council tax is $2880 per annum. They have credit card debt of $10,000. The minimum monthly repayment is $130 per fortnight at 18% interest.
Household expenses:
Food - $250 per week
Internet and phone - $125 per month
Cell phone - $80 per month
Toiletries - $60 per month
Children's after school care - $550 per month.
Petrol expenses are $200 per month. Car registration costs $312 per year for each car and each car requires 2 WAF per annum, which cost $60 each. Maintenance costs are $1200 per year for the 2 cars. Incidental expenses are $350 per fortnight. Insurance is $268 per fortnight.
They have $10,000 in savings and $15,000 in household possessions. Saving interest rate is 4%. The cars are worth 80% of their purchase price. Their retirement plan has a 5.5% return. In addition to their 4% contribution from their income, Don and Beth both receive 2% from their employers and $1000 each from the government for joining and $520 per year per account.
Construct a personal balance sheet and personal cash flow statement based on the information given. Cash flow statement is constructed on a fortnightly basis.
Any help at all is appreciated, thanks!
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