While reviewing the finances of the Stewarts, Ms. Brown, a CFP® certificant, is calculating a variety of financial ratios. The Stewarts have provided the following information:
Principal and interest $1,200 per month
Property insurance $600 per year
Property taxes $2,400 per year
Gross income $5,000 per month
Based on the information provided, calculate the Stewarts' housing cost ratio.
A)
3.45
B)
0.50
C)
0.29
D)
0.84