Kyle just started college. He also decided to establish a personal budget, but he's unsure of how to categorize his income and expenses. For example, he's unsure how to categorize the extra money he earns and saves each month. How should it be categorized?

Question

(1 point)

Oas eamed income

Oas a monthly expense

Oas unearned income

Oas a pre-tax expense

Answer 1

The extra money that Kyle earns and saves each month should be categorized as earned income. This is income that Kyle has worked for and earned through his efforts. It is not a monthly expense, unearned income, or a pre-tax expense.