Question

The average daily balance is the mean of the balance in an account at the end of each day in a month. The following table gives the dates and amounts of the transactions in Elliott's account in June.
Day of June Transaction type Transaction amount (in dollars)
1 Starting balance 1223
10 Deposit 615
15 Withdrawal -63
22 Withdrawal -120
There are 30 days in June.
What is the average daily balance of Elliott's account for the month of June?

Answer 1

Step-by-step explanation:

To calculate your average daily balance you must total your balance from each day in the billing cycle (even the day's that your balance didn't change) and divide the total by the number of days in the cycle.

Answer 2

$1583.9

Step-by-step explanation:

On 1st June, the starting balance is $1223. On 10th June, there is a deposit of $615, then on 15th June, there is a withdrawal of $63 and finally, on 22nd June, there was a withdrawal of $120.

Therefore, the average daily balance of Elliott's account for the month of June will be = $\frac{1223 \times 9 + (1223 + 615) \times 5 + (1223 + 615 - 63) \times 7 + (1223 + 615 - 63 - 120) \times 9}{30}$

= $1583.9 (Answer)