Analyze the following budget, with an income of $600, to determine how much can be spent on food for the month.
| Month | Budgeted Amount |
| ----------------- | --------------- |
| Cell Phone | $65 |
| Food | $ |
| Entertainment | $95 |
| College Savings | $200 |
| Car Expenses - Gas, Insurance | $160 |
A. $210 can be spent on food.
B. $145 can be spent on food.
C. $80 can be spent on food.
D. $260 can be spent on food.
Please select the best answer from the choices provided
Answer (2)
After calculating total expenses of $520 from a $600 income, $80 is available for food. Therefore, the amount that can be spent on food is $80. The correct answer is C. $80 can be spent on food.
;
Calculate the total expenses excluding food: $65 + $95 + $200 + $160 = $520.
Subtract the total expenses from the total income: $600 - $520 = $80.
Determine the amount available for food: $80.
The amount that can be spent on food is $80 .
Explanation
Analyze the problem We are given a budget with a total income of $600 and several expenses: cell phone ($65), entertainment ($95), college savings ($200), and car expenses ($160). We need to determine how much money can be spent on food.
Calculate total expenses First, let's calculate the total expenses excluding food. We add the expenses for cell phone, entertainment, college savings, and car expenses: 65 + 95 + 200 + 160 = 520
Calculate amount available for food Now, we subtract the total expenses (excluding food) from the total income to find the amount available for food: 600 − 520 = 80
State the final answer Therefore, $80 can be spent on food.
Examples
Budgeting is a crucial skill in personal finance. For instance, if you earn a monthly income and need to allocate funds for rent, utilities, transportation, and savings, understanding how to calculate remaining funds for discretionary spending like entertainment or food is essential. By subtracting fixed expenses from your income, you can determine how much is available for flexible spending, enabling better financial planning and decision-making. This ensures you live within your means and achieve your financial goals.
