Question

The beginning balance of Zerina's savings account for the month of July was $1800 and it remained this way for the first 12 days of the month. On July 13, Zerina made a withdrawal of $400, so her balance changed, and it remained the same for a total of 8 days. On July 21, Zerina made a deposit of $1200, so her balance changed again, and it remained the same for 11 days to finish out the month. If Zerina's savings account has an APR of 7.3%, calculates interest daily, and pays interest at the end of the month, how much did Zernia earn in interest in the month of July?

Answer 1

(1800-400+1200)×7.3 in interest
^
2600×7.3
^
$18,980 total.

Answer 2

Answer:

Interest income in the month =  $12.28

Final balance = 2612.28

Step-by-step explanation:

The initial amount of $1800 remains in the account for the first 12 days of July. Then:

Interest earned = $\frac{1800 * 0.073 * 12}{365} = 4.32$

Withdrawal = 400  

New balance =  1800 - 400 = 1400

The amount 1400 remains in the account for 8 days. Then:

Interest Earned =  $\frac{1400 * 0.073 * 8}{365} = 2.24$

Deposit =  1200

New balance =  1400 + 1200 = 2600

The amount 2600 remains in the account for 11 days. Then:

Interest Earned =  $\frac{2600 * 0.073 * 11}{365} = 5.72$

Balance =  2600 + 4.32 + 2.24 + 5.72 = 2612.28

Interest income in the month = 4.32 + 2.24 + 5.72 = $12.28