Frosni receieved her credit card statement, which showed she owed $5850. Interest is charged at 19.5%pa on overdue balances. She paid 15% of this amount by the due date,
How much interest is charged if she pays the remainder 20 days after the due date? working out please
To calculate the interest charged on the remainder balance 20 days after the due date, we first need to find out the remaining balance after Frosni paid 15% of it by the due date.
1. Calculate the amount Frosni paid by the due date:
Amount paid = 15% of $5850
= 0.15 * $5850
= $877.50
2. Determine the remaining balance after the payment:
Remaining balance = Total balance - Amount paid
= $5850 - $877.50
= $4972.50
Now, we can calculate the interest charged on this remaining balance for 20 days.
3. Convert the annual interest rate to a daily interest rate:
Daily interest rate = Annual interest rate / 365
= 19.5% / 365
= 0.0534% (rounded to 4 decimal places)
4. Calculate the interest charged for 20 days:
Interest charged = Remaining balance * Daily interest rate * Number of days
= $4972.50 * 0.000534 * 20
= $5.32 (rounded to 2 decimal places)
Therefore, if Frosni pays the remainder 20 days after the due date, she will be charged approximately $5.32 in interest.