On August 5, the billing date, Pat had a balance due of $185.72 on her credit card. Pat’s transactions during the month of August were

(a) Determine the finance charge on September 5 by using the previous balance method. Assume that the interest rate is 1.4% per month.

(b) Determine the new account balance on September 5 using the finance charge found in part (a).

(c) Determine the average daily balance for the period.

(d) Determine the finance charge on September 5 by using the average daily balance method. Assume that the interest rate is 1.4% per month.

(e) Determine the new account balance on September 5 using the finance charge found in part (d).

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August 8 August 10 August 15 August 21 Charge: Shoes Payment Charge: Dry cleaning Charge: Textbooks $85.75 75.00 72.85 275.00