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12 involve credit cards that calculate interest using the average daily balance
Chapter 8, Problem 1(choose chapter or problem)
Exercises 1 – 2 involve credit cards that calculate interest using the average daily balance method. The monthly interest rate is 1.5% of the average daily balance. Each exercise shows transactions that occurred during the March 1–March 31 billing period. In each exercise,
a. Find the average daily balance for the billing period. Round to the nearest cent.
b. Find the interest to be paid on April 1, the next billing date. Round to the nearest cent.
c. Find the balance due on April 1.
d. This credit card requires a $10 minimum monthly payment if the balance due at the end of the billing period is less than $360. Otherwise, the minimum monthly payment is 1 36 of the balance due at the end of the billing period, rounded up to the nearest whole dollar. What is the minimum monthly payment due by April 9?
Questions & Answers
QUESTION:
Exercises 1 – 2 involve credit cards that calculate interest using the average daily balance method. The monthly interest rate is 1.5% of the average daily balance. Each exercise shows transactions that occurred during the March 1–March 31 billing period. In each exercise,
a. Find the average daily balance for the billing period. Round to the nearest cent.
b. Find the interest to be paid on April 1, the next billing date. Round to the nearest cent.
c. Find the balance due on April 1.
d. This credit card requires a $10 minimum monthly payment if the balance due at the end of the billing period is less than $360. Otherwise, the minimum monthly payment is 1 36 of the balance due at the end of the billing period, rounded up to the nearest whole dollar. What is the minimum monthly payment due by April 9?
ANSWER:
Step 1 of 4
Finding the average daily balance for the billing period. First make the table,
Previous balance is
$300 for payment
$40 for charge
$90 for charge
$230 for charge