Household Expenditure Chapter 2 What is expenditure Expenditure
- Slides: 13
Household Expenditure Chapter 2
What is expenditure? �Expenditure is money that goes out of the household or business �We must plan for what money we have to spend to make sure we have enough �Some expenses can happen weekly (groceries, while others monthly (rent/mortgage)or yearly (car tax)
Types of Household Expenditure �Fixed Expenditure �This is expenditure that stays the same every month e. g. Rent, Mortgage, Loan Repayments, Milk bill �Irregular Expenditure �This is expenditure that changes every month e. g. . ESB, Telephone, Gas bills.
Types of Expenditure �Discretionary Expenditure �This is expenditure on once off or luxury items e. g. . Holidays, Cd’s, Designer Clothes, Concert Tickets, Computer Games. We should prioritise last.
State whether the following are Fixed/Irregular/Discretionary
Categories of Expenditure �Current Expenditure �This is expenditure on day-to-day items (ie. Things that last a short time). Eg. Food, petrol, phone credit
Categories of Expenditure �Capital Expenditure �This is expenditure on long term items/assets such a house, a car, a washing machine
Impulse Buying �This is when you buy goods that you did not plan too. Buy on the spur of the moment �Eg. You go into a shop to buy a paper and come out with a drink and bar of chocolate
Financial Cost v Opportunity Cost �Financial cost is the actual cost of the item you bought. E. g. Mars Bar for € 1. �Opportunity Cost is the cost of missing out on the opportunity of having another item instead. �Eg, you have a choice between a Mars and a Twix, they both cost € 1 each but you only have € 1, so you buy the Mars. The opportunity cost is the Twix. VS
False Economies �This is when you buy something that appears to be better value, but in the long run turns out to be more expensive �Eg. Handbag in Penny’s for € 15 V’s Brown Thomas € 100. The cheaper bag appears better value but is ‘probably’ poorer quality.
Importance of keeping a record �As we seen in our income chapter, it is important for families to keep records of money coming in. It is equally important for households to keep a record of money going out
Practice Question 1. 2. 3. 4. What is meant by Fixed, Irregular, and Discretionary expenditure? Which month was planned expenditure the greatest? Give a reason a family might spend more on entertainment in April? Name the 3 biggest and 3 smallest items of expenditure. Give the total column figures.
- Difference between expense and expenditure
- Capital expenditure vs revenue expenditure
- Deferred revenue expenditure
- Capital expenditure and revenue expenditure
- Two household chapter 6
- Two household chapter 39
- Two household chapter 30
- What are the useful materials at home?
- Microbes in household products
- Rhonda dalton
- Household metric conversion chart
- What's household composition
- Household product symbols
- Household and firm