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Year 5 Maths Money & Financial Maths

Budgets & financial plans

20 practice questions 0 video lessons Theory + worked examples
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Theory

A budget is a plan for how money will be spent. It lists each item, its cost and the total, and the total must not be more than the money you have. This Year 5 maths page shows how to build and check a budget, compare prices to find the best value, and plan a class fundraising stall.

A budget lists the items you plan to buy, the cost of each, and the total. A plan is within budget if the total is less than or equal to the money available; otherwise it is over budget.

Income is money coming in (such as sales). Expenses are money going out (such as ingredients). Profit \(=\) income \(-\) expenses.

To compare packs of different sizes, find the cost of one item (unit price) in each pack. The lower unit price is the better value.

Advertisements can make a deal look better than it is. Check by adding the separate prices yourself.

ItemCost
Bread rolls\(\$22\)
Fruit\(\$15\)
Juice\(\$19\)
Plates\(\$9\)
Total\(\$65\)
Picnic budget as a bar model A bar labelled total 65 dollars split into four parts: 22, 15, 19 and 9 dollars for rolls, fruit, juice and plates. Total: $65 $22 $15 $19 $9
The parts add to the total: \(22 + 15 + 19 + 9 = 65\).
Stall income, expenses and profit A column graph with a scale from 0 to 140 dollars in steps of 20. Income 132, expenses 47 and profit 85 dollars. Class stall 020406080100120140 Dollars Income Expenses Profit
Profit \(=\) income \(-\) expenses: \(132 - 47 = 85\).

Budget calculations:

\[ \text{money left} = \text{budget} - \text{total cost} \]
money left = budget − total cost
\[ \text{cost each} = \text{total} \div \text{number of people} \]
cost each = total ÷ number of people
\[ \text{unit price} = \text{pack price} \div \text{items in pack} \]
unit price = pack price ÷ items
\[ \text{profit} = \text{income} - \text{expenses} \]
profit = income − expenses
Line up the cents. Add dollars and cents in columns, with the decimal points lined up.
Cheapest is not always best value. A bigger pack can cost more but be cheaper per item.

Checking a plan against a budget

  1. Add the cost of every item.
  2. Compare the total with the budget.
  3. Subtract to find the money left over, or how much the plan is over.
  4. If over, choose an item to cut or swap that is worth at least the amount over.

Comparing value

  1. Find the cost of one item in each pack.
  2. Choose the lower unit price.
Example 1 — Total a budget
Use the table in the definitions. What is the cost of the juice, and is the total correct?
Solution
\(22 + 15 + 19 + 9\)\(=\)\(65\)
22+15+19+9=65

Juice costs \(\$19\). The total of \(\$65\) is correct.

Example 2 — Within budget?
The class has \(\$60\) for the picnic.
(i) Is the \(\$65\) plan within budget?
(ii) By how much is it over?
Solution
\(65 - 60\)\(=\)\(5\)
65−60=5

(i) No
(ii) \(\$5\) over. Cutting the plates (\(\$9\)) would bring it within budget.

Example 3 — Money left
Nina has a budget of \(\$90\) and spends \(\$57\). How much is left?
Solution
\(90 - 57\)\(=\)\(33\)
90−57=33

\(\$33\).

Example 4 — Cost per person and for a group
(i) Eight friends share a \(\$144\) bill equally. How much does each pay?
(ii) Entry costs \(\$7\) per student for \(26\) students. What is the total?
Solution
\(144 \div 8\)\(=\)\(18\)
\(26 \times 7\)\(=\)\(182\)
144÷8=18,26×7=182

(i) \(\$18\) each
(ii) \(\$182\)

Example 5 — Best value
Pack A has \(5\) muffins for \(\$15\). Pack B has \(8\) muffins for \(\$20\). Which is better value?
Solution
\(15 \div 5\)\(=\)\(3\)
\(20 \div 8\)\(=\)\(2.50\)
15÷5=3,20÷8=2.50

Pack A: \(\$3\) each. Pack B: \(\$2.50\) each. Pack B is better value.

Example 6 — How many can we buy?
Prizes cost \(\$7\) each and the budget is \(\$60\).
(i) How many prizes can be bought?
(ii) How much is left?
Solution
\(60 \div 7\)\(=\)\(8\ \text{r}\ 4\)
60÷7=8 r 4

(i) \(8\) prizes
(ii) \(\$4\)

Example 7 — Class stall
A stall makes \(\$85\) from cakes and \(\$47\) from drinks. It spends \(\$28\) on ingredients and \(\$19\) on cups.
(i) What is the income?
(ii) What are the expenses?
(iii) What is the profit?
Solution
\(85 + 47\)\(=\)\(132\)
\(28 + 19\)\(=\)\(47\)
\(132 - 47\)\(=\)\(85\)
132−47=85

(i) \(\$132\)
(ii) \(\$47\)
(iii) \(\$85\)

Example 8 — Check a deal
A sign says: "Bundle: hat, sunscreen and towel, only \(\$47.50\)!" Separately they cost \(\$21.50\), \(\$12.95\) and \(\$9.80\). Is the bundle a saving?
Solution
\(21.50 + 12.95 + 9.80\)\(=\)\(44.25\)
\(47.50 - 44.25\)\(=\)\(3.25\)
21.50+12.95+9.80=44.25

No. Buying them separately costs \(\$44.25\), so the bundle costs \(\$3.25\) more.

Common pitfalls

Forgetting an item. Tick off each line of the budget as you add it.
Comparing pack prices instead of unit prices. Divide by the number of items before comparing.
Mixing up profit and income. Profit is what is left after the expenses are paid.
Believing the advertisement. Words like "save" or "only" do not prove a saving. Do the sums.

Frequently asked questions

What is a budget?

A plan that lists what you will spend money on, the cost of each item and the total.

How do I know if a plan is within budget?

Add the costs. If the total is not more than the money available, it is within budget.

How do I find the better value?

Find the cost of one item in each pack: \(\$20 \div 8 = \$2.50\) beats \(\$15 \div 5 = \$3\).

What is profit?

Income minus expenses: \(\$132 - \$47 = \$85\).

How do I share a cost equally?

Divide the total by the number of people: \(\$144 \div 8 = \$18\).

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