The credit card with the transactions described in the popup below uses the average daily balance method to calculate interest. The monthly interest rate is 1.5% of the average daily balance. Calculate parts a-d using the statement in thepopup.Click the icon to view the credit card statement.a. Find the average daily balance for the billing period. Round to the nearest cent.The average daily balance for the billing period is $(Round to the nearest cent as needed.)b. Find the interest to be paid on July 1, the next billing date. Round to the nearest cent.The interest to be paid on July 1 is $(Use the answer from part a to find this answer. Round to the nearest cent as needed.)c. Find the balance due on July 1.The balance due on July 1 is $.(Use the answer from part b to find this answer.)1of the balance due at the end of the billing period, rounded up to25d. This credit card requires a $30 minimum monthly payment if the balance due at the end of the billing period is less than $400. Otherwise, the minimum monthly payment isthe nearest whole dollar. What is the minimum monthly payment due by July 9?The minimum monthly payment is $.i Credit Card Statement(Use the answer from part c to find this answer. Round up to the nearest dollar.)Enter your answer in each of the answer boxes.Transaction DescriptionPrevious balance, $2649.12June 1 Billing date.June 6PaymentJune 8June 9Charge: GasCharge: GroceriesCharge: GasJune 17Charge: GroceriesCharge: ClothingJune 27June 30 End of billing periodPayment Due Date: July 91Transaction Amount$1000.00 credit$35.43$136.79$41.87$127.12$214.61

The average daily balance is a method used by credit card companies to calculate the amount of…

Answered: The credit card with the transactions…

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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You have an account with a $1500 credit limit that charges 13.25% interest using the average daily balance method. Assuming a 30-day month, you start with a balance of $350 on Day 1. On Day 5, you charge $100, and you pay $60 on Day 15. What is your average daily balance, assuming charges and payments begin the next day? Round your answer to 2 decimal places and do not include the dollar sign
Use the average daily balance method to compute the finance charge on the credit card account for the month of August (31 days). The starting balance from the previous month is $300. The transactions on the account for the month are given in the table to the right. Assume an annual interest rate of 22% on the account and that the billing date is August 1st.
Suppose your VISA card calculates interest using the average daily balance method, and the monthly interest rate is 1.75%. The itemized billing for the month of April is shown below. Detail Unpaid balance Charge Charge Charge Payment received Last day of billing period Payment due date Date April 1 April 3 April 11 April 15 April 28 April 30 May 7 Amount 95 755 395 890 845 (a) Find the average daily balance. $ 1,453.17 (b) Find the interest due for this month. $ 25.43 Or (c) Find the total balance owed on the last day of the billing period. $ (d) This credit card requires a $20 minimum payment or 1/36 of the amount due, whichever is higher. What is the minimum monthly payment due for this month? $
The activity date, company, and amount for a credit card bill are shown below. The due date of the bill is July 10. On June 10, there was an unpaid balance of $987.81. Find the finance charge if the interest rate is 1.9% per month. (Round your answer to the nearest cent.) $ X Activity Date June 10 June 11 June 12 June 15 June 16 June 20 June 22 June 28 June 30 July 2 July 8 Company Unpaid balance Jan's Surf Shop Albertson's The Down Shoppe NY Times Sales Cardiff Delicatessen The Olde Golf Mart Lee's Hawaiian Restaurant City Food Drive Credit card payment Safeway Stores Amount 987.81 156.33 45.61 59,84 18.54 23.09 126.92 41.78 100.00 -1000.00 161.38 4
The table below shows the expenses and payments for 8 months on a credit card account with an initial balance of $400. Assume that the interest rate is 1.0% per month (12% APR) and that interest for a given month is charged on the balance for the previous month. Complete the table. After 8 months, what is the balance on the credit card? E Click the icon to view the table of expenses and payments. Complete the table below. (Round to the nearest cent as needed.) Month | Payment | Expenses | Interest | Balance - > Table of expenses and payments $400 $4.00 s204.00 --- --- --- 1 $400 $200 Month Payment Expenses Interest Balance $400 $200 1.0% x $400 204.00 2 $225 $225 1 $400 = $4.00 2 3 $225 $360 $400 $225 $350 $350 $60 $80 $200 S70 6 7 8. $100 $225 $110 Print Done
A credit card account had a balance of P 5 000 on October 12. A purchase of P 1500 was made on October 15 and a payment of P 3 500 was made on October 25. Find the current balance if the billing date is on November 12 and the interest rate is 2.5% per month. Answer:
For the credit card account, assume one month between billing dates (with the appropriate number of days) and interest of 1.1% per month on the average daily balance Find (a) the average daily balance, (b) the monthly finance charge, and (e) the account balance for the next billing Previous Balance: $485.26 January 13 Billing Date January 15 Retums January 20 Clothes January 27 Bus Sickets February 2 Payment February 6 Flowers $105.09 $114.34 $76.83 $130 $64.41 (a) The average daily balance is (Round to the nearest cent as needed.) (b) The finance charge is (Round to the nearest cent as needed) (c) The account balance for the next billing is $ (Round to the nearest cent as needed.)
The balance on Ramon Felipe's credit card on January 20, his billing date, was $205.12. For the period ending February 20, Ramon had the following transactions to the right. a) Find the average daily balance for the billing period. b) Find the finance charge to be paid on February 20. Assume an interest rate of 1.2% per month. c) Find the balance due on February 20. a) The average daily balance for the billing period was $ (Round to the nearest cent as needed.) b) The finance charge to be paid on February 20 is $ (Round to the nearest cent as needed.) c) The balance due on February 20 is $ (Round to the nearest cent as needed.) January 23 January 29 February 7 February 9 Charge: Restaurant meal Payment Charge: Lawn ornaments Charge: Microwave oven $47.21 $160.00 $57.92 $127.22
A credit card balance at the beginning of the month is $6,000. on the fourth day a $200 charge is made. on the tenth day a $1500 payment is made. on the seventeenth day a $200 charge is made, and a $100 payment. on the twentieth day a $500 charge is made. using the average daily balance method, Caculate the interest charged if the account had a 16.5% rate and the billing period is 31 days.
Use the unpaid balance method to find the finance charge on the credit card account for August. The starting balance from the previous month is $240. The transactions on the account for the month are given in the table to the right. Assume an annual interest rate of 21% on the account and that the billing date is August 1st.
Using the unpaid balance method, find the current month's finance charge on a credit card account having the following transactions. Last month's balance: $615 Last payment: $80 Annual Interest rate: 21% Purchases: $484 Returns: $545 The finance charge is $___ (Round to the nearest cent.)

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