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A customer charges a treadmill at Annie's Sport Shop. The price is $4,000 and the financing charge is 9% per annum if the bill is not paid in 30 days. The customer fails to pay the bill within 30 days and a finance charge is added to the customer's account. The accounts affected by the journal entry made by Annie's Sport Shop to record the finance charge are

Respuesta :

Answer:

$29.59 ≈ $30

Explanation:

Data provided in the question:

Charges for treadmill = $4,000

Financing charges = 9% per annum

number of days in the billing cycle = 30

Now,

The customer fails to pay the charges within the 30 days

therefore,

The financing charges for 30 days will be

= ( Amount × Financing charges × number of days in the billing cycle) ÷ 365

=  ( $4,000× 0.09 × 30 ) ÷ 365

= $29.59 ≈ $30

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