The previous balance method of calculating your finance charge uses the balance at the beginning of your billing cycle. Charges applied and payments credited to your account during the billing cycle won’t affect your finance charge.
APR = 14%
Periodic rate = 1.17%
Days in billing cycle = 30
Beginning balance = $1000
Payment 16th day = $100
Charge 20th day = $50
Ending balance = $950
Finance charge = Previous balance * periodic rate
= $1000 * .0117
= $11.70
Previous Balance Finance Charge Calculation
By LaToya Irby, About.com
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