Question

Mario's current credit card balance is $1,876.01 with a minimum payment of $59.00. Over the next month, he
plans to spend $565.00. If the APR is 23.99%, what will Mario's new balance be, including interest?
$2,326.06
O $2,382.01
O $2,429.63
$2,698.01

Answer 1

Mario's new balance on his credit card account with a current balance of $1,876.01 and a minimum payment of $59.00 and a planned expense of $565 at 23.99% APR, including interest, is C. $2,429.63.

How is credit card monthly interest calculated?

The credit card monthly interest is computed by multiplying the month-end balance by the monthly APR or APR/12.

Data and Calculations:

APR = 23.99%

Monthly APR = 1.9992% (23.99%/12)

Current credit card balance =   $1,876.01

Expenses for next month =          565.00

Minimum payment =                      (59.00)

Balance before interest =       $2,382.01

Finance charge (interest) =            47.62 ($2,382.01 x 23.99% x 1/12)

Balance, including interest = $2,429.63 ($2,382.01 + $47.62)

Thus, Mario's new balance on his credit card account is C. $2,429.63.

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