Question

Picture will be added... im all confused

Answer 1

@Hurgleman @

Answer 2

So for each row of the table, you're looking at a duration of time, a balance value, and a change to that value.

(Balance +/- change) * day count = Product/Sum

Since we're looking for a daily average, we want to be dividing by 30 (already shown at the bottom) So each segment needs to add up to a total of 30 days.

Row 1 has $387.52 for 5 days. That means it's equal to (387.52 * 5)
Row 2 shows that we have a change. On that day we have 337.52. It's also on one single day so we multiply it by 1 (which doesn't change it).
337.52*1 = product/Sum


Now for row 3, we note that there is no action change, so we can assume that the balance value doesn't change. That means it's still $337.52
Now it goes from the 7th to the 18th (18-7) so we multiply that by 11.
337.52 * 11 = Product/Sum

For the rest of the chart you just fill it in like that. Check the changes, figure the daily balance, then multiply by days.

When you're done filling in the chart add up all of the Product/Sums and divide by 30.

The product/Sum column is a calculation of every single day in that month, so dividing by 30 finds your daily average.
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Now you need to find that finance charge. This is an easy one. you know your monthly rate is 1.25%, and you have your daily average. Convert the percentage into a decimal by dividing by 100

.0125 = 1.25%
Then fill in the equation provided.
Daily Average * .0125 = charge

The last question I don't really have an answer for since it reads like there is more to the question, but it provides you with the formula. :D

I hope this was helpful!