Question

Nick has a revolving department store credit card account 15%. Last month balance on the account was $423.78. During the current month, he made purchases totaling $123.42 and made a payment of $100. The store uses the unpaid balance method. According to this information, what must be the amount of the finance charge? Round to the nearest cent.

Answer 1

Current Bal. = 423.78 + 123.42 = 100 =
$447.20.

Fin. Charge=(0.15/12) * 447.20 = $5.59.