Question

Using the unpaid balance method: find the finance charge

Last​ month's balance: ​$690
Last​ payment: ​$50
Annual Interest​ rate: ​%21
​ Purchases:​$578
​ Returns: ​$1033

Answer 1

3.25

yeah it's confusing but yeah

1. Start with the previous balance: $690

2. Add purchases: $690 + $578 = $1,268

3. Subtract returns: $1,268 - $1,033 = $235

4. Subtract last payment: $235 - $50 = $185

5. Calculate the monthly interest rate: 21% / 12 = 1.75%

6. Multiply the balance by the monthly interest rate: $185 x 1.75% = $3.24

7. Round the finance charge to the nearest cent: $3.24 ≈ $3.25

So, the finance charge using the unpaid balance method is $3.25.