Previous balance method
Previous balance method
Method of calculating finance charges based on the account balance at the end of the previous month.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.
Previous Balance Method
An accounting method in which interest owed on a good or service is calculated based on what is owed at the end of the month. Most credit cards calculate cost and interest on top of the balance at the end of the previous month. Payments on instruments that use the previous balance method are due at the beginning of the month.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved