Answer
See below
Work Step by Step
(a)
Prepare the table showing unpaid daily balances as shown as below:
Now, compute the average daily balance using the formula as mentioned above:
\[\begin{align}
& \text{Average daily balance}=\frac{\text{Sum of unpaid balances for each day in the billing period}}{\text{Number of days in the billing period}} \\
& =\frac{\$190,670}{31}\\&=\$6,150.65\end{align}\]
(b)
Compute the amount of interest payable using the equation as shown below:
\[\begin{align}
& \text{Interest}=\left( \text{Average daily balance} \right)\times \left( \text{Interest rate} \right)\times \left( \text{Time} \right) \\
& =\$6,150.65\times0.015\times1\\&=~\$92.26\end{align}\]
(c)
Compute the amount of balance due as on 1st April using the equation as shown below:
\[\begin{align}
& \text{Balance due as on April }{{\text{1}}^{\text{st}}}=\text{Balance due}+\text{Interest} \\
& =\$6,300+\$92.26\\&=\$6,392.26\end{align}\]
The amount of balance due as on April 1st is \[\$6,392.26\]that is more than\[\$360\], so the customer has to pay off the balance due.
\[\begin{align}
& \text{Minimum monthly payment}=\frac{\text{Balance due}}{36} \\
& =\frac{\$6,392.26}{36}\\&=\$178\end{align}\]
