Transcript 4-5 CREDIT CARD STATEMENT OBJECTIVES To identify and use the various entries in a credit card statement. Slide 1 Financial Algebra © Cengage/South-Western Key Terms           Slide 2 billing cycle credit card statement account.

4-5
CREDIT CARD
STATEMENT
OBJECTIVES
To identify and use the various entries
in a credit card statement.
Slide 1
Financial Algebra
© Cengage/South-Western
Key Terms
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Slide 2
billing cycle
credit card statement
account number
credit line
available credit
billing date
payment due date
transactions
debit/credit
previous balance
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payments/credits
new purchases
late charge
finance charge
new balance
minimum payment
average daily balance
number of days in billing cycle
APR
monthly periodic rate
Financial Algebra
© Cengage Learning/South-Western
Example 1
The summary portion of Jane Sharp’s credit card
statement shown is above.
a. Explain how the new purchases amount was determined.
b. Explain how the new balance amount was determined.
Slide 3
Financial Algebra
© Cengage Learning/South-Western
Example 1
The summary portion of Jane Sharp’s credit card
statement shown is above.
a. Explain how the new purchases amount was determined.
b. Explain how the new balance amount was determined.
Slide 4
Financial Algebra
© Cengage Learning/South-Western
CHECK YOUR UNDERSTANDING
Suppose you create the following spreadsheet that
models the statement summary and input the
values in row 2. Write the spreadsheet formula to
compute the new balance in cell F2.
Slide 5
Financial Algebra
© Cengage Learning/South-Western
Example 2
Pascual has a credit line of $15,000 on his credit
card. His summary looks as follows. How much
available credit does Pascual have?
Slide 6
Financial Algebra
© Cengage Learning/South-Western
CHECK YOUR UNDERSTANDING
Rhonda had a previous balance of $567.91 and made
an on-time credit card payment of $567.91. She has a
credit line of x dollars and made purchases totaling y
dollars. Write an algebraic expression that represents
her current available credit.
Slide 7
Financial Algebra
© Cengage Learning/South-Western
Example 3
Myrna is examining the summary section of her credit
card statement. Myrna has checked all the entries on
her bill and agrees with everything except the new
balance. Determine where the error was made.
Slide 8
Financial Algebra
© Cengage Learning/South-Western