Question

Calculate Maya's finance charge for September using the previous balance method, the adjusted balance method, and the daily balance method.

A) Provide detailed calculations for each method
B) Previous balance method: $12.47, Adjusted balance method: $14.63, Daily balance method: $13.28
C) Daily balance method: $12.47, Previous balance method: $14.63, Adjusted balance method: $13.28
D) The finance charge cannot be determined from the information provided.

Answer 1

Calculating Maya's finance charges requires specific balance and interest rates, which are not provided. The three methods include previous balance, adjusted balance, and daily balance methods of calculation. The specified fees for late payments are separate flat charges.

Step-by-step explanation:

To calculate Maya's finance charge for September using the previous balance method, adjusted balance method, and the daily balance method, specific balance and interest rate information would be required. Without this information, we cannot accurately compute the finance charges. Nevertheless, we can define these methods:

• The previous balance method applies the finance charge to the balance at the beginning of the billing cycle.
• The adjusted balance method subtracts any payments made during the billing cycle before the finance charge is applied.
• The daily balance method calculates the finance charge based on the balance each day of the billing cycle.

When a payment is late, the credit card company specified in the question charges a $10 fee, plus an additional $5 per day the payment is late. These are flat fees and not directly related to the balance methods used for calculating finance charges.