Question

predict how much money can be saved without having a negative actual net income.
monthly budget

	budgeted amount	actual amount
wages	$1150	$900
savings interest	$25	$25
expenses
rent	$400	$400
utilities	$100	$80
food	$250	$200
cell phone	$75	$75
savings	$200	$
net income	$150	$

a. it is not possible to save any money this month without having a negative actual net income.
b. $170 can be saved resulting in an actual net income of $0.
c. $200 can be saved resulting in an actual net income of $0.
d. as long as you are saving money, you will not have a negative actual net income.

Explanation:

Step1: Calculate actual total income

Actual income = Wages + Savings Interest = $900 + $25 = $925

Step2: Calculate actual total expenses

Actual expenses = Rent + Utilities+ Food + Cell Phone+ Savings = $400 + $80+ $200 + $75+ $75 = $830

Step3: Calculate maximum savings without negative net - income

Maximum savings = Actual income - Actual expenses = $925 - $830 = $95. But we can also calculate net - income formulaically. Let the additional savings be $x$. Net income = Income - Expenses. We want net income $\geq0$. So, $925-(830 + x)\geq0$. Solving for $x$ gives $x\leq95$. But if we consider the options, we calculate net income for each option.
Let's calculate actual net income without considering additional savings first: Actual net income = Actual income - Actual expenses = $925 - 830= $95.
If we save an additional $75$ (so total savings of $75 + 95=170$), net income = $925-(830 + 75)=0$

Answer:

B. $170 can be saved resulting in an actual net income of $0.