Let x be the total budget last year so that their total budget this year is x + 2000.

Since the Smiths spend 8% of their budget in entertainment and will spend $3840 this year, then we can write:

0.08(x + 2000) = 3840

Divide both sides by 0.08:

x + 2000 = 48000

Subtract 2000 from both sides:

x = 46000

Result: Smiths’ total budget last year was $46,000.

Since the Smiths spend 8% of their budget in entertainment and will spend $3840 this year, then we can write:

0.08(x + 2000) = 3840

Divide both sides by 0.08:

x + 2000 = 48000

Subtract 2000 from both sides:

x = 46000

Result: Smiths’ total budget last year was $46,000.