Here is Christine's credit card statement for the month of October. Transaction Date Transaction amount October 1 Beginning balance $2600.06 October 7 Payment October 14 Purchase October 20 Payment $960.00 $62.85 $700.00 (a) Use the credit card statement to help fill in the table below. Note that there are 31 days in October. Also, a purchase increases the unpaid balance, and a payment decreases the unpaid balance. Transaction Unpaid Unpaid Number Date Transaction Number of days at that balance amount balance balance of days 6 days (from October 1 through October 6) O days (from October 7 Beginning October 1 $2600.06 $2600.06 S15,600.36 balance October 7 Payment $960.00 $1640.06 through October 13) 6 days (from October 14 October 14 Purchase $62.85 through October 19) |12 days (from October 20 October 20 Payment $700.00 through October 31) Total: 31 days Total: $I (b) Find the average daily balance. Write your answer to the nearest cent. (c) Suppose the credit card company charges an interest rate of 1.6% on the average daily balance for October found in part (b). How much interest will be charged? Write your answer to the nearest cent. (d) What will Christine's beginning balance be for the month of November (including the interest for October found in part (c))?
Here is Christine's credit card statement for the month of October. Transaction Date Transaction amount October 1 Beginning balance $2600.06 October 7 Payment October 14 Purchase October 20 Payment $960.00 $62.85 $700.00 (a) Use the credit card statement to help fill in the table below. Note that there are 31 days in October. Also, a purchase increases the unpaid balance, and a payment decreases the unpaid balance. Transaction Unpaid Unpaid Number Date Transaction Number of days at that balance amount balance balance of days 6 days (from October 1 through October 6) O days (from October 7 Beginning October 1 $2600.06 $2600.06 S15,600.36 balance October 7 Payment $960.00 $1640.06 through October 13) 6 days (from October 14 October 14 Purchase $62.85 through October 19) |12 days (from October 20 October 20 Payment $700.00 through October 31) Total: 31 days Total: $I (b) Find the average daily balance. Write your answer to the nearest cent. (c) Suppose the credit card company charges an interest rate of 1.6% on the average daily balance for October found in part (b). How much interest will be charged? Write your answer to the nearest cent. (d) What will Christine's beginning balance be for the month of November (including the interest for October found in part (c))?
Chapter9: Accounting For Receivables
Section: Chapter Questions
Problem 10EA: Millennial Manufacturing has net credit sales for 2018 in the amount of $1,433,630, beginning...
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Transcribed Image Text:Here is Christine's credit card statement for the month of October.
Transaction
Date
Transaction
00
amount
October 1
Beginning balance
$2600.06
October 7
Payment
$960.00
October 14 Purchase
$62.85
October 20 Payment
$700.00
(a) Use the credit card statement to help fill in the table below. Note
that there are 31 days in October. Also, a purchase increases the
unpaid balance, and a payment decreases the unpaid balance.
Transaction
Unpaid
Unpaid Number
balance of days
Date
Transaction
Number of days at that balance
amount
balance
Beginning
6 days (from October 1 through
October 1
$2600.06 $2600.06
S15,600.36
balance
October 6)
| days (from October 7
October 7 Payment
$960.00 $1640.06
through October 13)
6 days (from October 14
October 14 Purchase
$62.85
through October 19)
12 days (from October 20
October 20 Payment
$700.00
through October 31)
Total: 31 days
Total: $I
(b) Find the average daily balance. Write your answer to the nearest
cent.
(c) Suppose the credit card company charges an interest rate of 1.6% on
the average daily balance for October found in part (b). How much
interest will be charged? Write your answer to the nearest cent.
(d) What will Christine's beginning balance be for the month of
November (including the interest for October found in part (c))?
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