Question

amy had an unpaid balance of 1753.05 on her credit card statement at the begining of june. she made a payment of 365.39. If the interest rate on Amys credit card was 7% per onth on the unpaid balance. Find her new finance charge and new balance on july 1

Answer 1

1. New balance on July 1=1,484.962

2. New finance charge=97.1362

Explanation:

The initial unpaid balance=1753.05 by June

Amy paid 365.39 on June

The unpaid balance after paying 365.39=Initial unpaid balance-amount paid on June

where;

Initial unpaid balance=1753.05

Amount paid on June=365.39

replacing;

The unpaid balance after paying 365.39=(1753.05-365.39)

The unpaid balance after paying 365.39 =1,387.66

The interest will be charged on the unpaid balance of 1,387.66

Interest=Principal×rate×time

Principal=1,387.66

Rate=7% per month

Time(in months)=Early June to early July=1 month

replacing;

Interest=1,387.66×(7/100)×1=97.1362

New balance on July 1=Unpaid balance after paying+Interest

where;

Unpaid balance after paying=1,387.66

Interest=97.1362

replacing;

New balance on July 1=(1,387.66+97.1362)=1,484.962

New balance on July 1=1,484.962

New finance charge=97.1362