Question

Jerrod Nofstger starts the month with a balance on his credit card of $1,020. On the 10th day of the month, he purchases $180 in clothes with his credit card. On the 15th day of the month, he makes a payment on his credit card of $750. Jerrod's interest rate is one and a half percent for the month. Jerrod's bank calculates the finance charge on their credit card by using the adjusted balance method. What would Jerrod's finance charges be for the month?

Answer 1

Given,

Beginning credit card balance = $ 1020

Payment made on credit card = $ 750

Interest rate = 1.5%

Solution :-

Finance charge = (beginning credit card balance - payment made on credit card) x interest rate

= ( $1020 - $750 ) x 1.5%

= $270 x 1.5% = $4.05

Thus, Jerrod's finance charge for the month would be $4.05