Question

Calculate the average daily balance and finance charge. (Round your answers to the nearest cent.)

30-day billing cycle
9/16	Billing date	Previous balance				$ 1,400
9/19	Payment		$	54 cr.
9/30	Charge: Home Depot			1,200
10/3	Payment			54 cr.
10/7	Cash advance			64

Finance charge is 1.25% on average daily balance.

Average daily balance	$
Finance charge	$

Answer 1

period	number of days	balance	number of days * balance
9/16-9/18	3	1400	(3*1400)=>4,200
9/19-9/29	11	1400-54 payment=>1,346	(11*1346)=>14,806
9/30-10/2	3	1346+1200 charge=>2,546	(3*2,546)=>7,638
10/3-10/6	4	2,546-54 =>2,492	(4*2,492)=>9,968
10/7-10/15	9	2492+64=>2,556	(9*2,556)=>23,004
	30	total	59,616

average daily balance = $59,616 / 30 days

=>$1,987.20.

finance charge = 1.25%* average daily balance

=>1.25%*1987.20

=>$24.84.