An unpaid credit card bill for $656.95 had a due date of May 8. Purchases of $365. were made on May 15, $122.78 on May 17, and $59.67 was charged on June 2. A payment of $340. was made on May 25. Find the finance charge due on June 8 if the interest rate on the average daily balance is 1.8%.

An unpaid credit card bill for $656.95 had a due date of May 8. Purchases of $365. were made on May 15, $122.78 on May 17, and $59.67 was charged on June 2. A payment of $340. was made on May 25. Find the finance charge due on June 8 if the interest rate on the average daily balance is 1.8%.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 4Q: American Signs allows customers to pay with their Jones credit card and cash. Jones charges American...

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Concept explainers

Credit card

A credit card is provided by financial institutions or banks, which permits a person to borrow money on a preapproved limit for purchases on a credit basis. The credit limit is decided by the institution and bank which issues a credit card depending on the person’s credit score and income. A cardholder can use the card for credit purchases, a balance transfer, cash advances.

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