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29 June, 23:50

Sarah has $15,000 in monetary assets, $48,000 in annual living expenses, a $20,000 balance on her car loan, and $60,000 of equity in her house. What is her month's living expenses covered ratio

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Answers (2)
  1. 30 June, 01:11
    0
    3.75

    Explanation:

    month's living expenses covered ratio = total liquid assets / total monthly cash expenses

    total liquid assets = $15,000 (home equity is not liquid) total monthly cash expenses = $48,000 / 12 = $4,000

    month's living expenses covered ratio = $15,000 / $4,000 = 3.75
  2. 30 June, 01:35
    0
    3.75 times

    Explanation:

    The formula used to calculate the monthly living expenses covered ratio is as under:

    Monthly living expenses covered ratio = Monetary Assets * 12 / Annual living expenses

    Here money assets is worth $15000 and annual living expense is $48,000.

    By putting the values we have:

    Monthly living expenses covered ratio = $15000 * 12 / $48000 = 3.75 Times
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Home » Business » Sarah has $15,000 in monetary assets, $48,000 in annual living expenses, a $20,000 balance on her car loan, and $60,000 of equity in her house. What is her month's living expenses covered ratio
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