average daily balance

Definition

The average amount that exists in an account over a period of time. The number is calculated by adding the daily balances over a period of time and dividing by the total number of days in that period. Used in the average daily balance method for determining interest.

Use this term in a sentence

Mentioned in these terms

Browse by Letter: # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
previous balance method average equity