The credit card with the transactions described on the right uses the average da

Question

The credit card with the transactions described on the right uses the average daily balance method to calculate interest. The annual interest rate is 30% of the average daily balance. Calculate parts a-c using the statement on the right. Find the average daily balance for the billing period. Round to the nearest cent. The average daily balance for the billing period is $. Find the interest to be paid on April 1, the next billing date. Round to the nearest cent. The interest to be paid on April 1 is $. Find the balance due on April 1. The balance due on April1 is $.

Explanation / Answer

All Amounts in $ Date Balance 1-Mar 6340 5-Mar -400 7-Mar 50 12-Mar 90 21-Mar 240 6320 $ Average Daily Balance = $ 6,320 / 31 = 204 $ Interest payable @ 30% on the average daily balance = 61.2 $ Balance due on April 1 = Closing Balance + Interest = $ 6,320 + $ 61.20 = 6381.2 $

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