PART 2
On Your Own
©South-Western, Cengage Learning
Family Financial Management: PART 2
Performance Outcomes
In Part 2 of this simulation, you will learn to:
1. Determine a single person’s net worth.
2. Plan a realistic budget for a single person.
3. Record a person’s daily financial activities in a
record book or in a computer file.
4. Organize the receipts, forms, and other paperwork
involved in financial activities.
Performance Outcomes are continued on the next slide.
©South-Western, Cengage Learning
Slide 2
Family Financial Management: PART 2
Performance Outcomes
5. Maintain a checking account, including making
deposits, writing checks, and balancing a
checkbook register.
6. Use an automated teller machine (ATM) and a debit
card.
7. Make smart purchasing decisions that fit within a
person’s budget.
8. Evaluate a person’s financial activities at the end of
each month.
©South-Western, Cengage Learning
Slide 3
Slide 4
Family Financial Management: PART 2
Meet Tyra M. Burns
 Tyra Burns is 24 years old.
 She lives alone in a rented
apartment.
 Tyra works full time as the
assistant manager of the
Water Point Grille.
 She earns $32,400 a year.
©South-Western, Cengage Learning
Family Financial Management: PART 2
Figuring Out Net Worth
 Assets—what you own
 Liabilities—what you owe
 Net Worth—the dollar value of what you own
minus the sum of your all your debts
Assets – Liabilities = Net Worth
©South-Western, Cengage Learning
Slide 5
Family Financial Management: PART 2
Statement of Net Worth
©South-Western, Cengage Learning
Slide 6
Slide 7
Family Financial Management: PART 2
Statement of Net Worth
List assets and
their cash value.
©South-Western, Cengage Learning
Slide 8
Family Financial Management: PART 2
Statement of Net Worth
Add the amounts
and enter the sum.
©South-Western, Cengage Learning
Family Financial Management: PART 2
Statement of Net Worth
List liabilities and
their cash value.
©South-Western, Cengage Learning
Slide 9
Slide 10
Family Financial Management: PART 2
Statement of Net Worth
Add the amounts
and enter the sum.
©South-Western, Cengage Learning
Family Financial Management: PART 2
Statement of Net Worth
Calculate net worth by
subtracting total liabilities
from total assets.
©South-Western, Cengage Learning
Slide 11
Slide 12
Family Financial Management: PART 2
Statement of Net Worth
Add total liabilities
and net worth.
©South-Western, Cengage Learning
Family Financial Management: PART 2
Tyra's Assets
 Checking account, $740.12
 Savings account, $69.65
 Savings bond, $200.00
 Current value of her used car, $3,700.00
 Value of her personal items, $1,200.00
 Cash, $90.00
©South-Western, Cengage Learning
Slide 13
Family Financial Management: PART 2
Tyra's Liabilities
 Amount she owes her parents for her car,
$1,400.00
 October rent, $450.00
 Tri-County Gas & Electric bill, $42.53
 Maplewood Telephone Company bill, $35.95
©South-Western, Cengage Learning
Slide 14
Family Financial Management: PART 2
Statement of Net Worth
for Tyra Burns
©South-Western, Cengage Learning
Slide 15
Family Financial Management: PART 2
Budget Worksheet
©South-Western, Cengage Learning
Slide 16
Family Financial Management: PART 2
Planning Tyra’s Budget
 Monthly Income
 Monthly Expenses
©South-Western, Cengage Learning
Slide 17
Slide 18
Family Financial Management: PART 2
Tyra’s Monthly Income
Gross pay
This period
Deductions
Year-to-date
Net Pay
Gross pay – Deductions = Net Pay
©South-Western, Cengage Learning
Slide 19
Family Financial Management: PART 2
Expense Categories




Savings/Debt Payoff
Home
Food/Sundries
Personal




Transportation
Entertainment
Miscellaneous
Health Care
©South-Western, Cengage Learning
Family Financial Management: PART 2
Slide 20
Budget Worksheet
for Tyra Burns
Savings/
Debt Payoff
Transportation
Home
Entertainment
Total expenses
should
be the
Miscellaneous
same as net pay.
Health Care
Food/Sundries
Personal
©South-Western, Cengage Learning
Family Financial Management: PART 2
Recording Tyra’s Transactions
 Use the Financial Record Book to record
every transaction in one master record.
 A transaction is any event that involves
money coming in or going out.
 To see how this works, you are going to
record all of Tyra’s transactions for October.
©South-Western, Cengage Learning
Slide 21
Slide 22
Family Financial Management: PART 2
Financial Record Book
Deposit column
Add the deposit to the
Subtract
theBalance
payment
amount
in the
from the amount in the
column.
Balance column.
Budget categories
The result is the current
Again,
the result
is the
balance—the
total
current
total
amountbalance—the
in the account
amount
in transaction.
the account
after the
after the transaction.
©South-Western, Cengage Learning
Slide 23
Family Financial Management: PART 2
Checkbook Register
Date
Check Number or
other notation
Fee
Description of
transaction
Payment
or debit
Deposit
or credit
©South-Western, Cengage Learning
Balance
Family Financial Management: PART 2
Paycheck Endorsed for Deposit Only
Endorsement
Endorsement
for area
deposit only
Back of check
©South-Western, Cengage Learning
Slide 24
Family Financial Management: PART 2
Slide 25
Filled-Out Deposit Ticket
Account holder’s name and address
Date
Amount of check
to be deposited
Total amount
to be deposited
Account number
©South-Western, Cengage Learning
Slide 26
Family Financial Management: PART 2
Write a Check
Account holder’s name and address
Date
Check number
Amount
using
numerals
Payee
Amount
in words
Purpose of
the check
Account number
Signature
©South-Western, Cengage Learning
Slide 27
Family Financial Management: PART 2
Parts of an Automated Teller
Machine (ATM)
Speaker
Keypad
Card
Reader
Slot
Deposit
Slot
Receipt Selection
Printer Buttons
Cash
Dispenser
 All ATM machines are
similar.
 They all have the eight
parts shown here.
Display
Screen
©South-Western, Cengage Learning
Family Financial Management: PART 2
JUMPSTART
 Standard: Develop a plan for spending and
saving.
 It is never too early to develop a plan for spending
and saving.
 You can start planning by thinking about where
you get money and how you spend it.
©South-Western, Cengage Learning
Slide 28
Family Financial Management: PART 2
Special Topic Readings
on the Data CD
Special Topic 4: How a Budget Puts You in
Control
Special Topic 5: Where Does All the Money
Go?
Special Topic 6: Saving for Something Special
©South-Western, Cengage Learning
Slide 29