Do Now #6: Vocab & Net Income

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What is gross pay?

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Gross pay is the total amount of money earned by an employee before any deductions, such as taxes or benefits.

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How do you calculate gross pay?

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Gross pay can be calculated by multiplying the hourly wage by the number of hours worked in a pay period.

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What is net pay?

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Net pay is the amount of money an employee takes home after all deductions, including taxes, have been subtracted from gross pay.

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How do you calculate net pay?

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Net pay is calculated by subtracting total deductions (like taxes) from gross pay.

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What are variable expenses?

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Variable expenses are costs that can change from month to month, such as groceries or entertainment.

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What are fixed expenses?

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Fixed expenses are costs that remain the same each month, such as rent or insurance premiums.

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What is a budget?

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A budget is a financial plan that outlines expected income and expenses over a specific period.

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What is a budget surplus?

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A budget surplus occurs when income exceeds expenses, resulting in extra funds.

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What is a budget deficit?

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A budget deficit occurs when expenses exceed income, leading to a shortfall.

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What is the envelope system in budgeting?

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The envelope system is a budgeting method where cash is divided into envelopes for different spending categories.