Mr. Smith did not pay his full credit card balance on June 5th, the due date each month forpayment. The unpaid balance was $800. He purchased a new washing machine on credit onJune 30 for $1,000. If interest is charged at a rate of 18%, compounded daily, what would be theinterest charge on his next credit card bill using the average daily balance method?a) $26.63b) $21.77c) $14.79d) $13.32

Interest charge refers to an amount that is being charged on the balance amount over the period that…

Answered: Mr. Smith did not pay his full credit…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter12: Current Liabilities

Section: Chapter Questions

Problem 11EB: Whole Leaves wants to upgrade their equipment, and on January 24 the company takes out a loan from...

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A customer was unable to pay the accounts receivable on time in the amount of $34,000. The customer was able to negotiate with the company and transferred the accounts receivable into a note that includes interest, along with an up-front cash payment of $6,000. The note maturity date is 24 months with a 15% annual interest rate. What is the entry to recognize this transfer?
Sally is in the business of purchasing accounts receivable last year Sally purchased an account receivable with a face value of 83,000 for 60,000. During the current year, Sally settled the account, receiving 65,000. Determine the maximum amount of the bad debt deduction for Sally for the current year.
Your client is preparing financial statements to show the bank. You know that he has incurred a refrigeration repair expense during the month, but you see no such expense on the books. When you question the client, he tells you that he has not yet paid the 1,255 bill. Your client is on the accrual basis of accounting. He does not want the refrigeration repair expense on the books as of the end of the month because he wants his profits to look good for the bank. Is your client behaving ethically by suggesting that the refrigeration repair expense not be booked until the 1,255 is paid? Are you behaving ethically if you agree to the clients request? What principle is involved here?
_____1. Johnson Industries, a semiweekly depositor, pays its employees every Friday. When should the company deposit the employment taxes for each weekly payday? _____2. What rule should Bartlett Repair, a new company, follow in making its deposits for accumulated employment taxes? _____3. Quail Hollow Motors (a semiweekly depositor) accumulates taxes of 105,000 on Monday and must deposit this amount on Tuesday, the next banking day. On Tuesday, the company accumulates additional taxes of 20,000. What deposit rule should Quail Hollow Motors follow for depositing the additional 20,000?
Whole Leaves wants to upgrade their equipment, and on January 24 the company takes out a loan from the bank in the amount of $310,000. The terms of the loan are 6.5% annual interest rate, payable in three months. Interest is due in equal payments each month. Compute the interest expense due each month. Show the journal entry to recognize the interest payment on February 24, and the entry for payment of the short-term note and final interest payment on April 24. Round to the nearest cent if required.
Flip opened a credit card account. During the first month he purchased new cloths that totaled $1,505.57 and then put the card in a desk drawer and didn’t use it again. The structure of the minimum monthly payment is the interest charge plus an additional 1.9% of the remaining balance. If Flip only makes the minimum monthly payment, how long will it take for the remaining balance to be half the amount of Flip's original purchases?
Bryan's credit card has an a APR of 12% for purchases and 19% for cash advances. they use a daily periodic rate for purchases and cash advances there is a cash advance fee of 3% . in a 31 day billing cycle,Bryan's purchases balance that is subject to finance charges is $286.26 .in addition he took an advance of $500 during the billing cycle and must a finance charges on it is for 15 days . Bryan did not pay off his credit card, and the next month the purchase balance subject to finance charges was $622.86. What are the total finance charges for a 31 day billing cycle?
Sammy Jo charged $1,000 worth of merchandise one year ago on her MasterCard. which has a stated interest rate of 18% APR compounded monthly. She made 12 regular monthly payments of $50, at the end of each month, and refrained from using the card for the past year. How much does she still owe?
David Kapamagian borrowed money from a bank to finance a small fishingboat. The bank's loan terms allowed him to defer payments (interest is still being charged even though payment is deferred) for six months and then to make 36 equal end-of-month payments thereafter. The original bank note was for $9,600 with an interest rate of 12% compounded monthly. After 16 monthly payments, David found himself in a financial bind and went to a loan company for assistance in lowering his monthly payments. Fortunately, the loan company offered to pay his debts in one lump sum, provided that he pays the company $208 per month for the next 36 months. What monthly rate of interest is the loan company chargingon this transaction?
Shiing Shen Chern's credit card company determines his minimum monthly payment by adding all new interest to 1% of the outstanding principal. The credit card company charges an interest rate of 0.038476% per day. On March 18, Shiing uses his credit card to purchase airline tickets for his family for $3300. He makes no other purchases during March. Use the given information and the rule that minimum payments are rounded up to the nearest dollar to answer parts a and b below. a) Assuming Shiing had no new interest, determine Shiing's minimum payment due on April 1, his billing date. Shiing's minimum payment due on April 1 is $3333. b) On April 1, instead of making the minimum payment, Shiing makes a payment of $600. Assuming there are no additional charges or cash advances, determine Shiing's minimum payment due on May 1. Shiing's minimum payment due on May 1 is $nothing.
Shiing Shen Chern's credit card company determines his minimum monthly payment by adding all new interest to 1% of the outstanding principal. The credit card company charges an interest rate of 0.038476%per day. On March 18, Shiing uses his credit card to purchase airline tickets for his family for $3300. He makes no other purchases during March. Use the given information and the rule that minimum payments are rounded up to the nearest dollar to answer parts a and b below. a) Assuming Shiing had no new interest, determine Shiing's minimum payment due on April 1, his billing date. Shiing's minimum payment due on April 1 is?
Shiing Shen Chern's credit card company determines his minimum monthly payment by adding all new interest to 1% of the outstanding principal. The credit card company charges an interest rate of 0.042782% per day. On March 17, Shiing uses his credit card to purchase airline tickets for his family for $3600. He makes no other purchases during March. Use the given information and the rule that minimum payments are rounded up to the nearest dollar to answer parts a and b below. a) Assuming Shiing had no new interest, determine Shiing's minimum payment due on April 1, his billing date. Shiing's minimum payment due on April 1 is $?

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