Question

Darrin Newberry’s charge account statement shows an unpaid balance of $875. The monthly finance charge is 1.65% of the unpaid balance. What is the new account balance?

Answer 1

Multiple 1.65/100 which equals 14.4375

The add 14.4375 to 875 & round to the closest cent which is 889.44

Answer 2

The new account balance is $889.44

Explanation:

Let us assume that this is a monthly statement and we have to find the total balance with one month's interest.

The unpaid balance in the account = $875

The monthly finance charge is 1.65% of the unpaid balance.

So, the monthly finance amount is =
`0.0165*875=14.437` dollars.

Thus, the new account balance will be =
`875+14.437=889.437` dollars or rounding to two decimal places we get $889.44.