Name: _______________________________ BC# _______________________
Using the information provided, analyze for Jennifer Barry’s financial situation
by answering the following questions. YOU MUST SHOW ALL CALCULATIONS
FOR FULL CREDIT, NOT JUST THE ANSWER.
Conclude the assignment by writing a 1-2 paragraph summation (or minimum of
6 sentences) and recommendation based on your answers. (15)
1. Create a balance sheet as of May 31, 2020 (10)
2. Create a cash flow statement for the period, May 1 – May 31, 2020 (10)
3. What is Jennifer’s monthly surplus (if any)? (2)
4. What is her asset to debt ratio? (2)
5. What is her savings ratio? (2)
6. How much does Jennifer need to save for a 3-month emergency fund? A 6-
month emergency fund? (5)
7. Assume at the end of 2020, Jennifer’s taxable income is $22,000. What is her
marginal tax rate? What is her effective tax rate? What is the tax liability on her
taxable income? (5)
8. Jennifer participates in her employer’s 401Kretirement plan. How much did
Jennifer contribute from her salary to her 401K in 2020? How much did her
employer contribute? (5)
9. What does Jennifer’s credit score say about her? How should she handle the
error on her credit report? (4)
12. What are the implications of the car dealer’s offer on the car that Jennifer is
considering? If she decides to purchase the 3-year old Honda, what would be the
monthly (new) loan payment (taking into consideration the current loan
outstanding on the 7 year Ford and its current value)? Is this a deal worth
considering? Why or why not? (5)
13. What kind of investor is Jennifer? Explain her investment philosophy. Does
her current investments match her philosophy? Why or why not? (5)
14. Analyze the Twitter stock information given. What does the following
information tell about the stock? (5)
1. Earnings per share
2. PE Ratio
15. Would you advise Jennifer to invest in Twitter stock? Why or why not? (5)
16. (TVM) Based on the case study provided, how long will it take for Jennifer to
pay off: (10)
(a) her car?
(b) her credit card balance?
(c ) her student loan?
17. (TVM) Based on the case study provided, compute the following: (10)
(a) Jennifer’s anticipated monthly mortgage payment on the home she is
interested in purchasing in 7 years
(b) how much will be in Jennifer’s 401K account in 40 years when she retires
(c) how much Jennifer would need to put away today to accumulate the 20%
down payment for the condo in 7 years? What other factors must she consider in
purchasing the condo?
(d) how much Jennifer would need to put away today to accumulate the $5,000 in
her savings account within 1 year? Based on her current financial obligations, is
this a realistic goal? Why or why not?
BALANCE SHEET SAMPLE
CASH FLOW STATEMENT SAMPLE
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