Laura’s credit card has an APR of 12.04%, and it computes finance charges using the daily balance method and a 30-day billing cy
cle. On June 1st, Laura had a balance of $606.40. She made exactly one transaction in June: a payment of $55.25. If Laura’s finance charge for June was $5.71, on which day did she make the payment?
Finance charge is equal to: daily balance*A*P*R*billing cycle/365 db 0.1204 30/365 = 5.71 db = 577.01 (I am rounding every answer, and keeping the number in my calculator, things won't work out exactly if you calculate using my numbers)Manipulate the formula for mean: average = total/amount 577.01 = total/30 total over 30 days = 17,310.22Set up an equation with our information: 606.40x + 55.25(30-x) = 17,310.22 551.15x = 16,652.72 x = 28.4
The balance was $606.40 for 28 days, so she paid on the 29th.
