Ending Balance Method of Calculating Finance Charges

The ending balance method of calculating your finance charge uses the balance at the end of the billing cycle. Your beginning balance is adjusted based on payments, credits, and new charges. The periodic rate is applied to this new balance.

APR = 14%

Periodic rate = 1.17%

Days in billing cycle = 30

Previous balance = $1000

Payment 16th day = $100

Charge 20th day = $50

Ending balance = $950

Finance charge = Ending balance * periodic rate

= $950 * .0117

= $11.12