## Credit Card Activity and Interest Calculation### OverviewYou have a credit card that charges an interest rate of 20.55% compounded monthly. The table below shows your activity for the month of April. (April has 30 days, which is the number of days in the billing cycle.) The Average Daily Balance is $561.95.### Activity Table| Date | Activity | $ ||----------|------------------------------------------|-----------|| April 1 | Beginning Balance, Start of Billing Cycle| 600.00 || April 6 | Purchase | 36.80 || April 9 | Payment | -200.00 || April 13 | Purchase | 92.25 || April 18 | Purchase | 16.00 || April 21 | Purchase | 47.00 || April 30 | End of Billing Cycle | |### Calculations**Calculate the interest for the month of April:**\[ \text{Interest} = \left( \frac{\text{Nominal Annual Rate}}{12} \right) \times \text{Average Daily Balance} \]**Calculate the new balance at the end of April:**New Balance: Beginning Balance + Purchases - Payments + Interest

The average daily balance method calculates interest charges for the period by multiplying the…

You have a credit card that charges an interest rate of 20.55% compounded monthly. The table below shows your activity for the month of April. (April has 30 days, which is the number of days in the billing cycle.) The Average Daily Balance is 561.95. Date April 1 April 6 April 9 Payment April 13 Purchase April 18 Purchase April 21 Purchase April 30 End of Billing Cycle Activity $ Beginning Balance, Start of Billing Cycle 600.00 Purchase 36.80 -200.00 92.25 16.00 47.00 Calculate the interest for the month of April? $ Calculate the new balance at the end of April.

You have a credit card that charges an interest rate of 20.55% compounded monthly. The table below shows your activity for the month of April. (April has 30 days, which is the number of days in the billing cycle.) The Average Daily Balance is 561.95. Date April 1 April 6 April 9 Payment April 13 Purchase April 18 Purchase April 21 Purchase April 30 End of Billing Cycle Activity $ Beginning Balance, Start of Billing Cycle 600.00 Purchase 36.80 -200.00 92.25 16.00 47.00 Calculate the interest for the month of April? $ Calculate the new balance at the end of April.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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In the month of September, Billy Jo made the following purchases: $4,000.00 on September 3 $2,750.00 on September 15 $450.00 on September 29. Billy Jo’s credit card contract has a 15% APR and a minimum payment of 2%. What was Billy Jo’s balance at the end of the month? What is the minimum dollar amount Billy Jo must pay?
Suppose the charge account of Strong's Mailing Service at the local supply store had a 1.8% interest rate per month on the average daily balance. Find the average daily balance if Strong's had an unpaid balance on March 1 of $196.90, a payment of $40 posted on March 8, and a purchase of $25.20 posted on March 16. The billing cycle ends March 31. The average daily balance is $ (Type an integer or decimal rounded to the nearest hundredth as needed.)
Kathy Hansen has a revolving credit account. The finance charge is calculated on the previous month's balance, and the annual percentage rate is 21%. Complete the account activity table for Kathy. (Round your answers to the nearest cent.) Month Previous Month's Balance (in $) Finance Charge (in $) Purchases and Cash Advances Payments and Credits New Balance End of Month (in $) June $824.08 $14.42 $159.38 $300.00 $697.88 July $ $ $72.59 $140.00 $ Need Help? Read It
Suppose the charge account of Strong's Mailing Service at the local supply store had a 1.8% interest rate per month on the average daily balance. Find the average daily balance if Strong's had an unpaid balance on March 1 of $141.50, a payment of $50 posted on March 10, and a purchase of $36.60 posted on March 24. The billing cycle ends March 31. The average daily balance is $ (Type an integer or decimal rounded to the nearest hundredth as needed.)
Consider the following credit card activity for the month of September: Date Balance September 1 $0 September 7 $331 September 13 $935 September 21 $1,552 September 25 $ 2,208 If this card's annual APR is 20.9% and the September balance is not paid during the grace period, how much interest is owed for September? There are 30 days in September. Round your answer to the nearest dollar.
Kathy Hansen has a revolving credit account. The finance charge is calculated on the previous month's balance, and the annual percentage rate is 21%. Complete the account activity table for Kathy. (Round your answers to the nearest cent.) Month PreviousMonth'sBalance(in $) FinanceCharge(in $) Purchasesand CashAdvances Paymentsand Credits New BalanceEnd of Month(in $) April $641.17 $11.22 $31.45 $85.00 $598.84 May $283.33 $135.00
10
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 inthe table to the right. Assume an annual interest rate of 25% on the account and that the billing date is August 1. August 4 made payment of $94.August 14 charged $140 for hiking boots August 17 charged $18 for gasoline August 29 charged $31 for restaurant meal. What is the finance charge for August?
Kathy Hansen has a revolving credit account. The finance charge is calculated on the previous month's balance, and the annual percentage rate is 21%. Complete the account activity table for Kathy. Previous Month Month's Balance March $640.00 $ Need Help? Read It Submit Answer Finance Charge (in $) Purchases and Cash Advances Payments and Credits $126.97 $75.00 New Balance End of Month (in $)
Problem #1. You have a Visa credit card account with a 26.49% annual percentage rate calculated on the average daily balance. The billing date is the first day of each month, and the billing cycle is the number of days in that month. Your credit card balance on April 1 was $552. On April 10th you made a $119 purchase. You made another purchase, a $25 gift card, on April 24th. You made a $150 payment on April 29th. Show your work for all parts of the problem. (a) What is the average daily balance for April? (b) What is your finance charge on the account as of May 1st? (c) What is your new credit card balance?
On October 25, you plan to purchase a $1,500 computer by using one of your two credit cards. The Silver Card charges 18% interest and calculates interest based on the balance on the first day of the previous month. The Gold Card charges 18% interest and calculates interest based on the average daily balance. Both cards have a $0 balance as of October 1. The closing date is the end of the month for each card. Your plan is to make a $500 payment in November, make a $500 payment in December, and pay off the remaining balance in January. All your payments will be received and posted on the 10th of each month. No other charges will be made on the account. (Round your answers to the nearest cent.) (a) Based on this information, calculate the interest (in $) charged by each card for this purchase. Silver Card Gold Card $7 $ 7.6 X (b) Which card is the better deal and by how much (in $)? The ---Select--- is the better deal by $
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? $

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