I have a revolving credit account that uses the average daily balance to calculate finance charges. during april 2007 ( amonth with 30 days) I had an unpaid balance of $445.12 for 18 days and a unpaid balance of $221.38 for 12 days . How do you calculate the average daily balance for april 2007?
To calculate the average daily balance for April 2007, you need to follow these steps:
1. Determine the balance for each day during April 2007 when you had an unpaid balance. In this case, you had an unpaid balance of $445.12 for 18 days and $221.38 for 12 days.
2. Multiply the balance for each day by the number of days it remained unpaid. For the first balance ($445.12) that was unpaid for 18 days, the calculation would be 445.12 * 18 = 8012.16. For the second balance ($221.38) that was unpaid for 12 days, the calculation would be 221.38 * 12 = 2656.56.
3. Add up all the balances obtained from step two. In this case, 8012.16 + 2656.56 = 10668.72.
4. Divide the total balance obtained from step three by the number of days in the billing cycle. Since April 2007 has 30 days, the calculation would be 10668.72 / 30 = 355.62.
Therefore, the average daily balance for April 2007 is $355.62.