Using the unpaid balance method, find the current months finance charge on a credit card account having the following transactions.
Last month’s balance: $385
Last payment: $250
Annual interest rate: 21%
Purchases: $303
Returns: $158
(It would be great if you could tell me how to use the formula I=Prt where previous months balance + finance charge + purchases made - returns - payments)

The periodic rate is the interest rate charged over a certain number of time periods. The interest on a credit card is usually calculated monthly, so if the annual interest rate is 21% then the periodic (monthly) rate is:

21 ÷ 12 = 1.75%

Convert the periodic rate from percent into decimal by dividing the percent value by 100: periodic rate = 1.75/100 = 0.0175

Unpaid balance = previous balance - (payments & credits)

⇒ Unpaid balance = 385 - 250 = 135

Finance change = unpaid balance x periodic rate

⇒ Finance change = 135 x 0.0175 = 2.3625

New balance = unpaid balance + finance charge + new purchases

⇒ New balance = 135 + 2.3625 + (303 - 158) = 282.3525

Therefore, the following month's finance charge on the new balance (assuming no payments are made) = 282.3525 x 0.0175 = 4.94