SECTION 7-1 pp. 258-260 Account Statements
Key Words to Know credit card (p. 258) A card that allows the cardholder to purchase goods and services on demand by presenting it. charge account (p. 258) An existing line of credit, often at a particular business.
Key Words to Know account statement (p.258) A bank statement that shows all deposits, withdrawals, and interest credited to an account. finance charge (p. 258) Interest that is charged to a credit account if the account holder does not pay on time.
Formula New Balance = Previous + Finance + New – (Payments + Credits) Balance Charge Purchases
Example 1 See Figure 7.1 on page 259 of your textbook. Martha Palmer received this charge account statement on October 2. What is her new balance?
Example 1 Answer Step: Find the new balance. Previous + Finance + New – (Payments + Credits) Balance Charge Purchases $332.64 + $5.64 + $173.03 – ($50.00 + $31.94) = $511.31 – $81.94 = $429.37