John had a credit card balance of $411.27 at the start of the June. He made purchases of $370 on June 7 and $840 on June 15, and one payment of $400 on June 28. If the interest on the average daily balance balance is 1.2% per month, then find the finance charge and the balance at the start of July.
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First, calculate the average daily balance for June.
The balance for the first 6 days of June is $411.27.
The balance for the next 8 days (June 7 to June 14) is $411.27 + $370 = $781.27.
The balance for the next 13 days (June 15 to June 27) is $781.27 + $840 = $1621.27.
The balance for the last 3 days of June (June 28 to June 30) is $1621.27 - $400 = $1221.27.
So, the average daily balance for June is (6*$411.27 + 8*$781.27 + 13*$1621.27 + 3*$1221.27) / 30 = $1133.91.
The finance charge for June is 1.2% of the average daily balance, which is $1133.91 * 1.2% = $13.61.
The balance at the start of July is the balance at the end of June plus the finance charge, which is $1221.27 + $13.61 = $1234.88.
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