IN CLASS CASE – Quiz Grade
It is January 2013 and Francisco Martinez (age 42) has decided to move forward with your financial planning services. You asked him to provide all of his cash flow items and assets and liabilities information. He would like you and your group members to take the information below and do the following:
1. Create a Balance Sheet and Cash Flow Statement
2. Create a Balance Sheet
3. Calculate the following ratios:
A. Emergency Fund Ratio
B. Change in Net Worth
C. Current Ratio
D. Housing Ratio #1
E. Housing Ratio #2
F. Debt to Total Assets
G. Net Worth to Total Assets
H. Savings Ratio
I. Investment Assets to Gross Pay
4. Please provide an over view of Francisco’s current situation. What are the positives and negatives?
Financial Data
401(k) contributions
House
Savings Account
Credit Card Payments
Total Income (Gross Pay)
PITI
Car Payment
Student Loan Payment
Roth IRA Savings
Dividends and Interest Income
Employer 401(k) match
Savings Account
Cable
Additional Monthly Savings (non retirement)
Mortgage
Car
Car Loan
AMEX Credit Card
Discover Credit Card
Auto Insurance
$300
$200,000
$10,000
$150
$85,000
$1,400
$300
$200
$50
$80
$3,000.00
$1,000
$120
$100
$180,000
$25,000
$18,000
$3,000
$1,000
$100
Total Taxes
Cell phone
Student Loan
Personal Property
Boat
CD (18 months until maturity)
401(k) account
Roth IRA
Vacation Expenses
Term Life Insurance Premiums
Food
Clothing
Lawn Service expense
Dividends and Interest Reinvestment
Net Worth 2012
$17,000.00
$120
$14,000
$10,000
$3,000
$1,000
$54,000
$3,000
$300
$50
$350
$150
$50
$80
$67,000
Assets
Liabilities
Cash and Cash Equivalents
Current Liabilities
Savings Account
10,000
AMEX Credit Card
3,000
Savings Account
1,000
Discover Credit Card
1,000
Investment Assets
Long-Term Liabilities
401(k) Account
54,000
Mortgage
180,000
Roth IRA
3,000
Car Loan
18,000
Employer 401(k) match
3,000
Student Loan
14,000
Personal Use Assets
House
200,000
Car
25,000
Personal Property
10,000
Boat
3,000
Income Statement
Income
Total Income
85,000
Savings Contributions
401(k) Contributions
300
Roth IRA Savings
50
Additional Monthly Savings
100
Dividends and Interest Reinvestment
80
Expenses
Cable
120
Cell Phone
120
Food
350
Clothing
150
Car Payment
300
Student Loan Payment
200
Auto Insurance
100
Vacation Expenses
300
Term Life Insurance Premiums
50
Credit Card Payments
150
Lawn Services Expense
50
Taxes
Total Taxes
17,000