Chapter 6 Financial Planning Exercise 3 Evaluating debt safety ratio

Use Worksheet 6.1. Chloe Young is evaluating her debt safety ratio. Her monthly take-home pay is $2,400. Each month, she pays $430 for an auto loan, $160 on a personal line of credit, $40 on a department store charge card, and $150 on her bank credit card. Complete Worksheet 6.1 by listing Chloe's outstanding debts.

Calculate her debt safety ratio. Round the answer to 1 decimal place. Enter debt safety ratio as a percentage.   %              $430+40+150+160 = $780               $780/$2,400=32.5% Given her current take-home pay, what is the maximum amount of monthly debt payments that Chloe can have if she wants her debt safety ratio to be 10.0%? Round the answer to the nearest dollar. $                   $2,400 x 10.0% = 240 Given her current monthly debt payment load, what would Chloe's take-home pay have to be if she wanted a 10.0% debt safety ratio? Round the answer to the nearest dollar. $                   $780 / 10.0% = 7800