Question

Can someone please tell me if I'm working this problem correctly? ( There is a chart, I'll draw it and attach it in the comments.) Then I'll show how I worked it and the answer that I got...

8. You (or your parents) purchase a new car for $19,725.00 plus 4.75% sales tax. The down payment is $2,175.00 and you (or your parents) have an average credit rating. How much interest is accrued after the first month?

Answer 1

The way I did it was like this:
$19,725.00*5.85%*1/12=96.15
$19,725.00+4.75%+96.15-2,175.00=$17,646.20


But other people keep getting 90.12 and this is how they are doing the work
$19,725.00*1.0475=$20,662
$20,662-$2,175.00=$18,487
5.85%/12=0.4875%
$18,487*0.004875=90.12


which is correct mine or theirs??? and please explain

Answer 2

this is the chart

Answer 3

can you help me @amistre64

Answer 4

You computed the interest before you computed the real cost of the car (with taxes added)

the other people who got 90.12 computed the cost of the car with taxes, then computed the interest