Describe how to calculate total finance charges on a credit card when there is a purchase balance and a cash advance balance using a daily periodic rate and the average daily balance method.
Q. 2Describe how to calculate the new balance on a credit card which uses the previous balance method.
Q. 3Describe how the average daily balance method calculates the finance charge for a billing period.
Q. 4Callie Brent's credit card statement for March 31 showed a previous balance of 210.40 and new purchases of 22.31 on 3/11, 12.11 on 3/18, and 34.85 on 3/23. She made a payment of 210.40 on 3/27. What is Callie's new balance?
Q. 5Jeremy Stahl's credit card which has a 15 APR requires a minimum payment of 3 of the current balance each billing cycle. Jeremy's current balance is 368.79, and his credit card company uses the previous balance method and a monthly periodic rate for calculating finance charges. What is the minimum payment due? If Jeremy makes the minimum payment, what will his balance be next month if he makes no additional purchases?
Q. 6On June 1st, Jared has a 1,500 beginning balance on his credit card. He decides to stop making charges on his card and work towards paying it off. His credit card has an APR of 18. Monthly periodic finance charges are calculated using the previous balance method. If Jared makes monthly payments of 150, how much will he owe in 6 months? How much will he have paid in periodic finance charges?
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