You purchased a new car for $19,725.00 plus sales tax. The down payment is $2,175.00 and you have an average credit rating for 6.30% How much interest is accrued after the first month?
To calculate the interest accrued after the first month, we need to find the remaining principal balance after the down payment and then determine the interest on that amount.
Remaining principal balance = Total cost - Down payment
Remaining principal balance = $19,725.00 - $2,175.00 = $17,550.00
Interest for the first month = (Average credit rating / 12) * Remaining principal balance
Interest for the first month = (6.30% / 12) * $17,550.00
Interest for the first month = (0.0525) * $17,550.00
Interest for the first month = $919.88 (rounded to the nearest cent)
Therefore, the interest accrued after the first month is $919.88.