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Roger L

compound interest on overdue accounts

Posted By

Keith, your blog re. the new compound interest is excellent, and it explains why the monthly interest is different in 30 days vs. 31 days months. But the finance charges only appears on the printed statement, so

   how do I deal with an 2nd statement sent within a week (per customer request), that shows an updated charge

   how do send a statement to a customer with an overdue amount without finance charge (because I need to), yet send statements to other customers with
   charges - I see nothing on the customer record to pick and choose

   how/when do I create the finance charge invoice, to track the receivable and to apply the payment


Will the next Sage version will include this extra functionality, please confirm ?

http://sagecity.na.sage.com/support_communities/sage_50_accounting_ca/b/sage_50_ca_supporthub_blog/archive/2014/12/09/sage-50-2015-new-functionality-3-compound-interest.aspx

  • 0

    Hi Roger,

    1. Sage 50 will not calculate interest to any invoices which are paid already.  If within a week, one of the many invoices of an individual customer is paid, that invoice will no longer be used to calculate interest.  When you print the statement on a later date within the week, that paid invoice will no longer be shown on the statement (if you do not paid invoices in the statement), and it will not be used to calculate interest.  

      For your information, If you have several invoices, their due dates may be different from the other.The calculation is based on the individual invoice number of days overdue , multiplied by the daily rate and by that invoice amount. It is not based on the total of all oustanding invoices multiply by the monthly interest rate.

    2. Sorry to inform you that Sage 50 does not have the option to turn off interest calculation for some customers but not the others.  As an alternative, you can first go to Setup, Settings, Receivables, Option, and uncheck the Interest Changes.  Then, you can go to print statement for customer that you do not want to show finance charges.  After that, you can go back to Setup, Settings and put the Interest Charges check mark back on.  Then, you will print statement for customers that you plan to show finance charges.

    3. You only create the finance charge invoice when you actually receive the finance charge payment from the customer.  Since the invoice is created and is paid at the same time, it will not show up in the customer statement for interest calculation.  If this is not an option and you need to create the interest invoice in advance, make the Net days to 999 so the finance charge invoice will not be used for interest calculation. 
    4. I do not hear from our R&D that they will include a function to turn interest calculation on and off on individual customer or have a switch to show interest charges on statement for individual customers.  You may need to provide feedback to us by going to Help, Contact Sage and Give us your feedback.  If the suggestion is already posted in ideascale (http://sage50canadian.ideascale.com/a/index), please have as many  users to vote on that idea.

    Hope this helps. 

     

*Community Hub is the new name for Sage City