2014 Q1 B Vs 2013 Q1 A

[harshd]

2014 Q1 B Vs 2013 Q1 A

In Guuideline answer, for 2014 1B, it does not include the 135K after tax income, nor the 35K savings after accounting for ongoing expenses. It just adds 25K and 60K to arrive at the liquidity need of 85K

In 2013 1A, it looks at the expenses and reduces after tax income and whatever is remaining is considered cash needed in coming year.

How does one decide whether to account for income or not?

Thanks

 

[S2000magician]

In the 2014 question, the $35,000 is deposited automatically into the investment portfolio.
This isn’t the case in the 2013 question.

 

[harshd]

wow. thanks. so if we do not see the money, then don’t consider it? sounds about right in real life too.

 

[S2000magician]

That’d be my take on it.