8.4 The difference between budgets and statements

Consider the previous activity, where Douglas planned to travel to Durban. He eventually decided to travel to Durban using bus Option 1. He kept all the receipts and till slips so that he could write a statement to see how much money he actually spent. Read the following summary of Douglas's bus trip:

When Douglas arrived at the bus station to buy the ticket, he finds that the advertised price did not include VAT, and he needs to add \(\text{14}\%\) to the cost. To add to his problems, the bus breaks down and Douglas needs to find a place to stay the night in Knysna. He finds a backpackers' lodge that costs \(\text{R}\,\text{200}\) a night for a shared room. He also needs to rent a locker for \(\text{R}\,\text{20}\) to keep his luggage safe. He needs to buy both supper and breakfast, which cost him \(\text{R}\,\text{30}\) each.

A household has the following monthly expenses:

• rent \(\text{R}\,\text{2 300}\);
• transport \(\text{R}\,\text{520}\);
• cell phone \(\text{R}\,\text{200}\);
• pre-paid electricity \(\text{R}\,\text{800}\);
• water bill \(\text{R}\,\text{350}\);
• TV contract \(\text{R}\,\text{250}\);
• loan repayment \(\text{R}\,\text{310}\);
• furniture store account \(\text{R}\,\text{570}\);
• clothing store account \(\text{R}\,\text{315}\);
• groceries \(\text{R}\,\text{2 500}\);
• medical expenses \(\text{R}\,\text{75}\)

They live on the following monthly income: a state pension of \(\text{R}\,\text{1 140}\), a disability grant of \(\text{R}\,\text{1 140}\) and a salary of \(\text{R}\,\text{5 250}\). This month, one of the children falls ill and they have additional medical expenses of \(\text{R}\,\text{500}\) for doctor's visits and medication.