Adjusted balance method

Definition:

Method of calculating finance charges that uses the account balance remaining after adjusting for all transactions posted during the given billing period as its basis. Related: Average daily balance method, previous balance method, past due balance method.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Credit Terms

The conditions under which credit will be extended to a customer. The components of credit terms are: cash discount, credit period, net period.

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