Your purchase cost $4, 900.25, including tax. You sign an installment loan to pay $1, 200 as a down payment. The remainder including the finance charge will be paid in 40 monthly installments of $102.58. What is the total finance charge?
The total cost of the purchase after the down payment is $4,900.25 - $1,200 = $3,700.25.
The total amount paid through monthly installments is 40 x $102.58 = $4,103.20.
To find the finance charge, we need to subtract the amount borrowed ($3,700.25) from the total amount paid back ($4,103.20).
$4,103.20 - $3,700.25 = $402.95
Therefore, the total finance charge is $402.95.