Annual expenses for an individual are shown in the table. To prorate the annual costs into a monthly budget, how much money per month should be budgeted for car registration?
| | |
| :-------------------- | :-------- |
| **Annual Expenses** | |
| Car Registration | $84.00 |
| Car Insurance | $565.00 |
| Home Insurance | $1,070.00 |
Round to the nearest cent.
Answer (2)
Divide the annual car registration expense by 12 to find the monthly expense.
Perform the calculation: 12 $84.00 = $7.00 .
The monthly budgeted amount for car registration is $7.00 .
Explanation
Problem Analysis We are given the annual car registration expense and asked to find the equivalent monthly expense. To do this, we will divide the annual expense by the number of months in a year, which is 12.
Calculating Monthly Expense To find the monthly budgeted amount for car registration, we divide the annual cost by 12: 12 $84.00 = $7.00
Final Answer Therefore, the amount that should be budgeted each month for car registration is $7.00 .
Examples
Budgeting is a crucial skill in personal finance. For example, if you know your annual expenses for entertainment are $600 , you can divide this by 12 to find that you should budget $50 per month for entertainment. This helps you manage your spending and avoid overspending.
To find the monthly budget for car registration, divide the annual amount of $84.00 by 12 months. The result is $7.00 per month. Therefore, the budgeted amount for car registration each month is $7.00.
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