**Credit Card Statement Analysis** This section covers an example of a credit card statement for educational purposes. We will analyze the transactions, understand how to calculate the average daily balance, and see how the finance charge affects the new balance. **Statement Overview:** **Dates and Transactions:** - **9/2:** Billing date with a previous balance of $1,160.00 - **9/7:** Payment of $420.00 - **9/13:** Charge at Kohl’s: $440.00 - **9/17:** Payment of $370.00 - **9/28:** Charge at WalMart: $140.00 **Instructions for Calculation:** - **APR:** The annual percentage rate is 15%. - **Objective:** Calculate Dallas’s average daily balance, the finance charge, and the new balance. - **Rounding:** Round your final answers to the nearest cent. **Detailed Steps:** 1. **Calculate the Average Daily Balance:** - Determine the balance for each day of the billing cycle. - Sum the daily balances. - Divide by the number of days in the billing cycle (30 days). 2. **Compute the Finance Charge:** - Use the APR to find the daily periodic rate: \( \frac{15\%}{365} \). - Multiply the average daily balance by the daily rate and then by the number of days in the billing cycle. 3. **Determine the New Balance:** - Add the finance charge to the last balance on record within the cycle. - Include any new charges made before the statement cycle ended. By following these steps, you can effectively manage your credit card statements and financial obligations. Understanding each component aids in better financial planning and management.
**Credit Card Statement Analysis** This section covers an example of a credit card statement for educational purposes. We will analyze the transactions, understand how to calculate the average daily balance, and see how the finance charge affects the new balance. **Statement Overview:** **Dates and Transactions:** - **9/2:** Billing date with a previous balance of $1,160.00 - **9/7:** Payment of $420.00 - **9/13:** Charge at Kohl’s: $440.00 - **9/17:** Payment of $370.00 - **9/28:** Charge at WalMart: $140.00 **Instructions for Calculation:** - **APR:** The annual percentage rate is 15%. - **Objective:** Calculate Dallas’s average daily balance, the finance charge, and the new balance. - **Rounding:** Round your final answers to the nearest cent. **Detailed Steps:** 1. **Calculate the Average Daily Balance:** - Determine the balance for each day of the billing cycle. - Sum the daily balances. - Divide by the number of days in the billing cycle (30 days). 2. **Compute the Finance Charge:** - Use the APR to find the daily periodic rate: \( \frac{15\%}{365} \). - Multiply the average daily balance by the daily rate and then by the number of days in the billing cycle. 3. **Determine the New Balance:** - Add the finance charge to the last balance on record within the cycle. - Include any new charges made before the statement cycle ended. By following these steps, you can effectively manage your credit card statements and financial obligations. Understanding each component aids in better financial planning and management.
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
Related questions
Question
Average daily balance: ??
Finance charge: ??
New balance: ??
Transcribed Image Text:**Credit Card Statement Analysis**
This section covers an example of a credit card statement for educational purposes. We will analyze the transactions, understand how to calculate the average daily balance, and see how the finance charge affects the new balance.
**Statement Overview:**
**Dates and Transactions:**
- **9/2:** Billing date with a previous balance of $1,160.00
- **9/7:** Payment of $420.00
- **9/13:** Charge at Kohl’s: $440.00
- **9/17:** Payment of $370.00
- **9/28:** Charge at WalMart: $140.00
**Instructions for Calculation:**
- **APR:** The annual percentage rate is 15%.
- **Objective:** Calculate Dallas’s average daily balance, the finance charge, and the new balance.
- **Rounding:** Round your final answers to the nearest cent.
**Detailed Steps:**
1. **Calculate the Average Daily Balance:**
- Determine the balance for each day of the billing cycle.
- Sum the daily balances.
- Divide by the number of days in the billing cycle (30 days).
2. **Compute the Finance Charge:**
- Use the APR to find the daily periodic rate: \( \frac{15\%}{365} \).
- Multiply the average daily balance by the daily rate and then by the number of days in the billing cycle.
3. **Determine the New Balance:**
- Add the finance charge to the last balance on record within the cycle.
- Include any new charges made before the statement cycle ended.
By following these steps, you can effectively manage your credit card statements and financial obligations. Understanding each component aids in better financial planning and management.
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