Answer:
The average daily balance on the June 5 bill is approximately $909.16.
Explanation:
To find the average daily balance on the June 5 bill, we need to calculate the balance for each day and then find the average of those balances.
Breakdown of the transactions:
Initial balance on May 5: $968
Purchase on May 17: -$295 (negative because it's an expense)
Payment on May 20: -$100 (negative because it's a reduction in the balance)
Calculate the daily balances:
May 5 to May 16 (12 days):
Initial balance: $968
Daily balance = $968
May 17 (1 day):
Balance after purchase: $968 - $295 = $673
Daily balance = $673
May 18 to May 19 (2 days):
Balance remains $673
Daily balance = $673
May 20 (1 day):
Balance after payment: $673 - $100 = $573
Daily balance = $573
May 21 to June 4 (15 days):
Balance remains $573
Daily balance = $573
Calculate the average daily balance:
Total days = 12 + 1 + 2 + 1 + 15 = 31 days
Sum of daily balances = (12 * $968) + ($673) + (2 * $673) + ($573) + (15 * $573) = $28144
Average daily balance = Sum of daily balances / Total days = $28144 / 31 ≈ $909.16
Therefore, the average daily balance on the June 5 bill is approximately $909.16.