1. Total interest over 7 months = $84.77 2. Payment made over 7 months $65.21. 3. Principal paid over 7 months = 65.23 4. Salvatore's new balance = $1352.82 5. Salvatore's interest = 15.895
How do we calculate the interests?
To calculate the total interest paid over 7 months.
Total Interest Paid =
$18.38+$17.39+$14.98+$14.46+$10.48+$9.08 = $84.77
Total Payments Made Over 7 Months
Total Interest Paid=
$0.00+$6.62+$7.59+$10.02+$10.54+$14.52+$15.92 = $65.21
To calculate the total principal paid over 7 months, I summed up the "Principal Paid" column:
25×6 = 150
150 - $84.77 = 65.23
Salvatore's new balance at the end of month 8
1281.91 + 79.99 - 9.08 = $ 1352.82
Salvatore interest charged for month 8
14.9%/9 = 1.24
1281.91 × 1.24/100 = 15.895
Full question
Salvatore's credit card has an APR of 14.9% calculated on the previous monthly balance. His credit card record for the last 7 months is shown in the table below.Salvatore is trying to figure out what this all means. Help him by answering the following questions. Part 1: What is the total amount that Salvatore has paid in interest over the 7 months? Part II: What is the total amount that Salvatore has made in payments over the 7 months? Part III: How much of Salvatore's payments has gone to paying down the principal on his account? Part IV: What is Salvatore's new balance at the end of month 8? Part V: What will Salvatore be charged for interest for month 8?