the finance charge at 12% interest for an original charge amount of 300.00 and a payment of 50.00 halfway through the month would be how much ?
To calculate the finance charge, we need to know the time period for which the interest is being calculated. In your question, you mentioned that the payment is made halfway through the month, but we still need to know the total length of the billing period (such as one month or one year).
Assuming a monthly billing period, here's how you can calculate the finance charge:
Step 1: Calculate the interest for the first half of the month.
The interest for the first half of the month can be calculated by multiplying the original charge amount by the interest rate and dividing it by the number of periods in a year (12, since we assumed a monthly billing period):
Interest for the first half of the month = (Original charge amount * Interest rate) / 12
In this case, the interest for the first half of the month would be:
Interest for the first half = (300.00 * 0.12) / 12 = 3.00
Step 2: Calculate the remaining balance after the payment.
After making the payment of $50.00, subtract it from the original charge amount:
Remaining balance = Original charge amount - Payment
Remaining balance = 300.00 - 50.00 = 250.00
Step 3: Calculate the interest for the second half of the month.
Using the remaining balance, calculate the interest for the second half of the month in the same way as in Step 1:
Interest for the second half of the month = (Remaining balance * Interest rate) / 12
Interest for the second half of the month = (250.00 * 0.12) / 12 = 2.50
Step 4: Calculate the total finance charge.
Add the interest for the first half of the month and the interest for the second half of the month to get the total finance charge:
Total finance charge = Interest for the first half + Interest for the second half
Total finance charge = 3.00 + 2.50 = 5.50
Therefore, the finance charge for this scenario, assuming a monthly billing period, would be $5.50.