Adam’s bank account has a balance of $1213.69 before he starts spending money. He makes the following transactions:

Question

Transaction
Cost ($)
Car payment
260.16
Groceries
97.98
Parking ticket
75.00
DVD box set
115.35
Antique lamp
68.53
Suit
331.84

Adam is considering getting his car a new paint job. Doing so will have a total cost of $264.83. Can Adam afford this?
a.
Yes, he can make the purchase and still have money left over.
b.
Yes, but doing so will clear out his account.
c.
No, purchasing that would overdraw his account.
d.
No, he is overdrawn already.

Answer 1

To determine if Adam can afford the new paint job costing $264.83, we first need to calculate his remaining balance after all the transactions.

Starting balance: $1213.69

Now, let's sum up all the costs from his transactions:

1. Car payment: $260.16
2. Groceries: $97.98
3. Parking ticket: $75.00
4. DVD box set: $115.35
5. Antique lamp: $68.53
6. Suit: $331.84

Total expenses = $260.16 + $97.98 + $75.00 + $115.35 + $68.53 + $331.84 Total expenses = $949.86

Now, we subtract the total expenses from the starting balance:

Remaining balance = Starting balance - Total expenses Remaining balance = $1213.69 - $949.86 Remaining balance = $263.83

Now, we can check if Adam can afford the paint job:

Remaining balance after expenses: $263.83 Cost of the new paint job: $264.83

Since $263.83 (remaining balance) is less than $264.83 (cost of paint job), Adam cannot afford the paint job without overdrawing his account.

The answer is: c. No, purchasing that would overdraw his account.