The Smiths spend 6% of their budget on entertainment. Their total budget this year is $3,000 more than last year, and this year they plan to spend $2,580 on entertainment. What was their total budget last year?

Answer: Their total budget last year was $40,000.

Step-by-step explanation:

Given : The Smiths spend 6% of their budget on entertainment.

i. e., The money they spend on entertainment = 0.06 x (Total budget)

{ 6% is converted to 0.06, when we divide it by 100 to remove percentage)

Since, this year they plan to spend $2,580 on entertainment.

i. e. 0.06 x (Total budget) = $2,580

On dividing both sides by 0.06, we get

(Total budget) = $2,580 : 0.06

= $43,000

Thus, their total budget for this year = $43,000

Also, Their total budget this year is $3,000 more than last year.

Therefore, their last year total budget = (Total budget this year) - $3000

= $43,000 - $3000

= $40,000

Hence, their total budget last year was $40,000.