Mary paid $456 for an annual contract to an ISP on July 1, 2012. She terminated her contract with the ISP on March 8. The contract requires to refund a prorated amount to the exact number of days remaining in the period of coverage. A $50 service charge is then deducted. What refund will Mary receive?
A) $142.42
B) $92.42
C) $54.94
D) $50
E) $0

Question

Quizplus · Accepted Answer

First, we need to determine the number of days remaining in the period of coverage. 
July 1, 2012 to March 8, 2013 is a total of 251 days.

Next, we need to determine what percentage of the annual contract is remaining. 
251/365 = 0.6877 or approximately 69%.

We then multiply this percentage by the cost of the contract: 
0.69 x $456 = $314.64

Finally, we subtract the $50 service charge: 
$314.64 - $50 = $264.64

Therefore, Mary will receive a refund of $264.64. Of the answer choices provided, the closest option is B.

Mary Paid $456 for an Annual Contract to an ISP