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11 December, 12:21

Poindexter has a credit card that uses the average daily balance method. For the first 15 days of a 31-day cycle, his balance was $2110, but then he paid off his entire balance and didn't make any new purchases. If his credit card's APR is 26%, how much was poindeexter charged in interest for the billing cycle

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Answers (2)
  1. 11 December, 12:38
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    22.55 is the answer on Apex.
  2. 11 December, 15:03
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    Answer: $22.54

    Given:

    Poindexter's credit card uses the average daily balance method.

    After the first 15 days of a 31-day cycle, his balance was $2110

    He paid off his entire balance and didn't make any new purchases

    His credit card's APR is 26%,

    His average daily balance for the month can be computed as:

    Day 1 - 15 $2110

    Day 16 - 31 %0

    (Day 1 Balance + Day 2 Balance + Day 3 Balance ...) / number of days in the billing cycle

    ($2110x15) / 31

    $31,650/31

    $1020.97

    The interest Poindexter will be charged for the billing cycle is as follows:

    ((.26/365) * 1020.97) * 31=

    0.000712*1020.97

    0.72 * 31

    $22.54
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