DoAssignment.ca

DoAssignment study guide

F1.3 · Track income and spending to maintain a balanced budget

Learn to track income and spending to maintain a balanced budget through clear examples and targeted practice.

Ontario Grade 8 Mathematics

Financial Literacy

A Grade 8 lesson on recording money in and money out

Imagine you receive money for a few chores and spend some of it on snacks and a notebook. If you do not keep track, it can be hard to know how much money remains. A budget is a plan for money coming in and money going out. Tracking means recording each amount so you can compare the two totals. The examples in this lesson use hypothetical amounts in Canadian dollars (CAD).

What you will learn

  • Explain what income, spending, and a budget mean.
  • Record income and spending clearly over a set period.
  • Compare total income with total spending to see whether a budget is balanced.
  • Use a spending record to make a simple change when spending is greater than income.

1. Start with money in and money out

Income is money you receive. For a young person, income might include an allowance or money earned from a task. Spending is money used to buy something or pay for a cost. These examples are not the same for everyone.
Before comparing amounts, identify the time period. A record for one week should include the income and spending for that week. Do not compare one week's income with a month's spending.
A spending record can be simple. Write the date, what happened, and the amount. Label each entry as income or spending. This makes it easier to check that nothing has been counted in the wrong group.
  • Income is money received.
  • Spending is money used.
  • Track both over the same time period.

2. Compare the totals

Add the income entries to find total income. Add the spending entries to find total spending. A budget is balanced when the totals are equal. If total income is greater, some money remains. If total spending is greater, the plan uses more money than it brings in.
A comparison bar chart can make the totals easy to see. Both bars need the same unit and scale. The longer bar shows the larger total. The chart does not replace the record: the written entries explain where the totals came from.
Use the same process each time you update the record: add new entries, check the totals, then compare them. This helps you notice a difference before assuming there is money available to spend.
total income=total spending\text{total income} = \text{total spending}
  • Add income entries separately from spending entries.
  • A balanced budget has equal income and spending totals.
  • A difference between the totals shows whether the plan needs attention.

3. Use the record to make a plan

If spending is greater than income, first check the record for missing or repeated entries. If the entries are correct, the plan needs to change. For example, a person could decide to spend less on a planned purchase or wait until more income is available. The choice depends on the person's situation.
If income is greater than spending, the difference is money not used during that period. It is still important to record it. A budget is a tool for making a plan, not a promise that every week will be exactly the same.
Keep the record clear and honest. Include small purchases as well as large ones. If an amount is uncertain, check it before using the total to make a decision.
money remaining=total income−total spending\text{money remaining} = \text{total income} - \text{total spending}
  • Check the entries before changing a plan.
  • Record small purchases too.
  • Use the totals to guide a realistic plan for the same period.

A simple weekly money record

EntryTypeAmount
AllowanceIncomeCAD 12
TaskIncomeCAD 9
GameSpendingCAD 8
FoodSpendingCAD 6

Worked example

Example 1: Track one week

A student receives hypothetical income of CAD 18 for helping at home. During the same week, the student spends CAD 5 on a snack and CAD 7 on a notebook. Find the income total, spending total, and amount remaining.
One week's money
One week's moneyThe income bar is CAD 6 longer than the spending bar.18 CADIncome (CAD)12 CADSpending (CAD)

The income bar is CAD 6 longer than the spending bar.

  1. Record the entries
    Write the income and each purchase in separate groups. Keeping the same week for all entries makes the comparison fair.
  2. Add spending
    The two purchases make up the spending total. Add them because both amounts were spent during the week.
    5+7=125 + 7 = 12
  3. Compare totals
    The student received CAD 18 and spent CAD 12. Subtract spending from income to find the amount not spent.
    18−12=618 - 12 = 6
Answer: Total income is CAD 18, total spending is CAD 12, and CAD 6 remains.
Check: The spending total is smaller than the income total, so the remaining amount is positive.

Worked example

Example 2: Check whether a plan is balanced

For a hypothetical week, a student records CAD 12 of allowance and CAD 9 from a task. The spending record shows CAD 8 for a game and CAD 6 for food. Decide whether the budget is balanced and find the difference.
Weekly income and spending
Weekly income and spendingThe bars compare hypothetical totals for the same week.21 CADIncome (CAD)14 CADSpending (CAD)

The bars compare hypothetical totals for the same week.

  1. Find total income
    Add the two income entries because both were received in the same week.
    12+9=2112 + 9 = 21
  2. Find total spending
    Add the two spending entries. They show how much of the week's money was used.
    8+6=148 + 6 = 14
  3. Compare the totals
    The totals are not equal. Income is greater, so the budget is not balanced; CAD 7 remains unspent.
    21−14=721 - 14 = 7
Answer: The budget is not balanced. Total income is CAD 21, total spending is CAD 14, and CAD 7 remains.
Check: Adding CAD 7 to the spending total gives CAD 21, which matches income.

Worked example

Example 3: Adjust a plan

In a hypothetical week, a student has CAD 20 of income. The spending record lists CAD 9 for a planned activity, CAD 7 for supplies, and CAD 6 for snacks. The student wants spending to be no more than income. If the snack spending is reduced by CAD 3, will the plan meet that goal?
Revised weekly plan
Revised weekly planAfter the hypothetical change, spending is CAD 1 below income.20 CADIncome (CAD)19 CADRevised spending (CAD)

After the hypothetical change, spending is CAD 1 below income.

  1. Check the original spending
    Add all three spending entries to see how the original plan compares with income.
    9+7+6=229 + 7 + 6 = 22
  2. Apply the planned change
    Reducing snack spending by CAD 3 changes that entry from CAD 6 to CAD 3. Add the revised entries to find the new spending total.
    9+7+3=199 + 7 + 3 = 19
  3. Compare with income
    The revised spending total is less than CAD 20 of income. The plan meets the goal, with CAD 1 remaining.
    20−19=120 - 19 = 1
Answer: Yes. Revised spending is CAD 19, which is CAD 1 less than the CAD 20 income.
Check: The revised snack entry is CAD 3, and the three revised entries add to CAD 19.

Common mistakes and how to avoid them

Adding income and spending together and calling the result money remaining.
Correction: Find each total separately. Compare total income with total spending.
Including entries from different time periods in one comparison.
Correction: Use income and spending from the same week or other chosen period.
Leaving out a small purchase because it seems unimportant.
Correction: Record every purchase. Small amounts can change the total.
Assuming a budget is balanced just because money remains.
Correction: A balanced budget has equal income and spending totals. Money remaining means income was greater.

Lesson summary

  • Record each income and spending entry for the same time period.
  • Add the income entries and spending entries separately.
  • Compare the totals to see whether the budget is balanced.
  • If spending is greater than income, check the record and adjust the plan.

Check your understanding

Question 1

A hypothetical weekly record has CAD 16 of income and spending of CAD 5 and CAD 8. How much remains?
  1. CAD 3
  2. CAD 13
  3. CAD 21
  4. The budget is balanced.
Show answer and explanation
CAD 3
Spending is CAD 13, and CAD 16 minus CAD 13 is CAD 3.

Question 2

Which statement describes a balanced budget?
  1. Income is greater than spending.
  2. Spending is greater than income.
  3. Income and spending totals are equal.
  4. There are no spending entries.
Show answer and explanation
Income and spending totals are equal.
A budget is balanced when its total income and total spending are equal.

Question 3

A student's hypothetical income is CAD 14. Spending is CAD 9 and CAD 7. What should the student conclude?
  1. The budget is balanced.
  2. Spending is CAD 2 greater than income.
  3. Income is CAD 2 greater than spending.
  4. Spending is CAD 16 less than income.
Show answer and explanation
Spending is CAD 2 greater than income.
The spending entries total CAD 16. That is CAD 2 more than CAD 14 of income.

Key terms

Income
Money received.
Spending
Money used to buy something or pay for a cost.
Budget
A plan for money coming in and money going out.
Track
Record information over time so it can be checked and compared.
Balanced budget
A budget where total income equals total spending.

Continue through Grade 8 Math

View the complete Grade 8 Math Ontario Grade 8 Mathematics curriculum and lessons

About this lesson and its review

Published by DoAssignment. This reviewed lesson follows Ontario Grade 8 Mathematics, expectation F1.3. It is a study resource, not an official curriculum publication.

Before publication, content is checked for structure, mathematical or chemical notation, calculations, course boundaries, and readability. Errors can still occur, so corrections are welcomed.

Official curriculum reference

Report a correction or ask a question