Alev has a $300 balance on her credit card that she forgot about. Each month, the balance increases by 13% due to compound interest. How much will her balance be 6 months from now if she continues to forget and not make any payments? Show your work AND explain your thinking.

Alev has a $300 balance on her credit card that she forgot about. Each month, the balance increases by 13% due to compound interest. How much will her balance be 6 months from now if she continues to forget and not make any payments? Show your work AND explain your thinking.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

1. Alev has a $300 balance on her credit card that she forgot about. Each month, the
balance increases by 13% due to compound interest. How much will her balance be 6
months from now if she continues to forget and not make any payments? Show your
work AND explain your thinking.

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Step 1 Introduction (Reasoning for your reference)

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Step 2 Calculation of Closing credit card balance at the end of 6months (Calculation Method)

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Step 3 Calculation of Closing credit card balance at the end of 6months (Formula Method)

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