Anand’s monthly bank statement showed the following deposits and withdrawals:
$5.18, -$69.31, $9.74, $58.38, -$95.69
If Anand’s balance in the account was $49.41 at the beginning of the month, what was the account balance at the end of the month?
The correct answer and explanation is:
To calculate the final account balance, we need to start with the initial balance and then apply each of the deposits and withdrawals. The sequence of transactions is as follows:
- Starting balance: $49.41
- First deposit: +$5.18
- First withdrawal: -$69.31
- Second deposit: +$9.74
- Second deposit: +$58.38
- Second withdrawal: -$95.69
Now, let’s apply each transaction:
Step 1: Starting balance
The initial balance is $49.41.
Step 2: First deposit
Adding the first deposit of $5.18:
$49.41 + $5.18 = $54.59
Step 3: First withdrawal
Subtracting the first withdrawal of $69.31:
$54.59 – $69.31 = -$14.72
Step 4: Second deposit
Adding the second deposit of $9.74:
-$14.72 + $9.74 = -$4.98
Step 5: Third deposit
Adding the third deposit of $58.38:
-$4.98 + $58.38 = $53.40
Step 6: Second withdrawal
Finally, subtracting the second withdrawal of $95.69:
$53.40 – $95.69 = -$42.29
Thus, the balance at the end of the month is -$42.29.
Explanation:
To calculate the ending balance, each deposit adds money to the account, and each withdrawal subtracts money. The total effect of all the transactions is a combination of these deposits and withdrawals. Since the final result is negative, it indicates that the account is in overdraft by $42.29.