Level 1
Chapter 13 – Section I – Exercise 8
Kathy Hansen has a revolving charge account. The finance charge is calculated on the
previous month’s balance, and the annual percentage rate is 21%. Complete the fol-
lowing account activity line for Kathy if her March purchases total $121.37. She made
a $55 payment during the billing cycle, and her previous balance was $560.
Level 1
Chapter 13 – Section I – Exercise 9
Continuing Kathy Hansen’s revolving charge account report, use the new balance from
problem 8 as a starting point. Kathy made a $65 payment during April’s billing cycle
and she had total charges of $46.45.
Level 3
Chapter 13 – Section I – Exercise 14
Calculate the average daily balance for October for a revolving credit account with a
previous month’s balance of $140 and the following activity.
Date Activity Payment
Unpaid
balance
Day-
weighted
balance
Level 1
Chapter 13 – Section I – Exercise 18
The Jewelery Exchange Corporation has a $30,000 line of credit with NationsBank. The
annual percentage rate is the current prime rate plus 4.7%. The balance on March 1
was $8,400. On March 6, the Exchange borrowed $6,900 to pay for a shipment of
supplies, and on March 17 it borrowed another $4,500 for equipment repairs. On
March 24, a $10,000 payment was made on the account. The billing cycle for March
has 31 days. The current prime rate is 9%.
Dates # of Days Activity
Amount
Unpaid
balance
Daily Balance
Previous
Mar 1-5 5 Charge Balance 8,400.00 42,000.00
Mar 6-16 11 Charge 6,900.00 15,300.00 168,300.00
Mar 17-23 7 Charge 4,500.00 19,800.00 138,600.00
Mar 24-31 8 Payment 10,000.00 9,800.00 78,400.00
31 $427,300.00
a. What is the finance charge on the account?
b. What is the company‘s new balance?
c. On April 1, how much credit does the Jewelry Exchange have left on the account?
Level 1
Chapter 13 – Section II – Exercise 5
Calculate the amount financed, the finance charge, and the total deferred payment
price for an installment loan of $8,750 requiring a 15% down payment, with 48
monthly payments of $198.33.
Level 2
Chapter 13 – Section II – Exercise 12
Calculate the amount financed, the finance charge, and the amount of the monthly
payments for an add-on interest loan of $50,300 requiring a down payment of 25%
and charging add-on interest of 12.4% for 60 months:
Level 2
Chapter 13 – Section II – Exercise 45
Belinda Raven is interested in buying a solar energy system for her home. At
Sun-Catchers, Inc., she picks out a system for a total cash price of $1,899. The
salesperson informs her that if she qualifies for an installment loan, she may pay
10% now, as a down payment, and finance the balance with payments of $88.35
per month for 24 months.
a. What is the amount of the finance charge on this loan?
Purchase price = $1,899.00
b. What is the total deferred payment price of the system?
Level 3
Chapter 13 – Section II – Exercise 48
Doug Black bought a jet ski with a 9% add-on interest installment loan
from his credit union. The purchase price was $1,450.00. The credit union
required a 15% down payment and equal monthly payments for 48 months.
What are Doug’s monthly payments?
Level 1
Chapter 13 – Section II – Exercise 53
Find the sum of the digits of
Level 1
Chapter 13 – Assessment Test – Exercise 7
George Bell bought an ultralight airplane for a cash price of $29,200.00. He made a 15% down
payment and financed the balance with payments of $579.00 per month for 60 months.
a. What is the amount of the finance charge on George’s loan?
b. What is the total deferred payment price of the motor home?
Level 2
Chapter 13 – Assessment Test – Exercise 12
After making 11 payments on a 36-month loan, you pay it off.
a. What is your rebate fraction?
Hint: Use Excel’s Concatenate function to display the rebate fraction.
b. If the finance charge was $1,300, what is the amount of your finance charge rebate?
Level 3
Chapter 13 – Assessment Test – Exercise 13
An Auntie Anne’s franchise financed a $68,000 pretzel oven with a 6 1/2% add-
on interest installment loan for 48 months. The loan required a 20% down payment.
a. What is the amount of the finance charge on the loan?
Purchase price = $68,000.00
b. How much are the monthly payments?
c. What annual percentage rate is being charged on the loan?
d. If the company decides to pay off the loan after 22 months, what is the amount of the
loan payoff?
Number of payments = 48