Question

Calculate the monthly finance charge for the credit card transaction. Assume that it takes 10 days for a payment to be received and recorded and that the month is 30 days long. (Round your answer to the nearest cent.)

Balance:	$675
Rate:	18%
Payment:	$64
Method:	Average daily balance

$

Answer 1

Balance	=	$         675
Rate	=	18%
Payment	=	$           64
Month	=	30	days
Payment to be received in	=	10	days
Amount left after payment	=	$675 - $64
	=	$         611
Average daily balance for the month	=	[($675 X 10) + ($611 X 20)] / 30 days
	=	$   632.33
Interest charge for the month is	=	$632.33 X 18% X 30/365
	=	$        9.36