Below are some examples of different types of Finance Charges. Whether you want to retroactively apply charges or just to initially set up.
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Finance Charge Calculation Examples
Example 1: Finance charges set up at the beginning; no retroactive charges
Example 2: Finance charges set up at the beginning; retroactive charges apply
Example 3: Intermittent finance charges; retroactive charges apply
Example 4: Finance charges set up at the beginning; corrections made; no retroactive charges
Example 5: Finance charges set up at the beginning; corrections made; retroactive charges apply
Example 6: Finance charges with a gap; payment made; corrections made; retroactive charges apply
Finance Charge Calculation Examples
To help explain how finance charges are calculated by Avionté, several examples are provided below. These examples apply to version 13.2 and beyond.
Note: Finance charges will only show on the Statement Letter and AR Aging Report. Finance charges are NOT shown on an invoice.
Example 5: Finance charges set up at the beginning; corrections made; retroactive charges apply
Preconditions
Customer with invoices overdue.
Table 16. Retroactive Charges Apply
Invoice number | Due date | Invoice amount | Bill amount | Balance amount | Sales tax | Discount amount | Total finance charges |
---|---|---|---|---|---|---|---|
101 | 1/1/2013 | $100.00 | $100.00 | $96.12 | 0 | 0 | $6.12 |
101-R1 | 1/1/2013 | $60.00 | $60.00 | $60.00 | 0 | 0 | 0 |
101-R2 | 1/1/2013 | - $10.00 | - $10.00 | $0.00 | 0 | 0 | 0 |
Table 17. Finance charges
Invoice number | Month ID | Finance charge date | Chargeable amount | Finance charge amount | Total chargeable amount due | Charge type |
---|---|---|---|---|---|---|
101 | 1 | 1/2/2013 | $100.00 | $2.00 | $102.00 | Retroactive |
101 | 2 | 2/2/2013 | $102.00 | $2.04 | $104.04 | Retroactive |
101 | 3 | 3/2/2013 | $104.04 | $2.08 | $106.12 | Retroactive |
Results
Table 18. Finance charges assessed after first invoice correction
Invoice number | Month ID | Finance charge date | Chargeable amount | Finance charge amount | Total chargeable amount due | Charge type | Finance charge removed? |
---|---|---|---|---|---|---|---|
101 | 1 | 1/2/2013 | $100.00 | $2.00 | $102.00 | Retroactive | Yes |
101 | 2 | 2/2/2013 | $102.00 | $2.04 | $104.04 | Retroactive | Yes |
101 | 3 | 3/2/2013 | $104.40 | $2.08 | $106.12 | Retroactive | Yes |
101 | 1 | 1/2/2013 | $100.00 | - $2.00 | $102.00 | Removal | No |
101 | 2 | 2/2/2013 | $102.00 | - $2.04 | $104.04 | Removal | No |
101 | 3 | 3/2/2013 | $104.04 | - $2.08 | $106.12 | Removal | No |
101 | 1 | 1/2/2013 | $160.00 | $3.20 | $163.20 | Correction | No |
101 | 2 | 2/2/2013 | $163.20 | $3.26 | $166.46 | Correction | No |
101 | 3 | 3/2/2013 | $166.46 | $3.33 | $169.79 | Correction | No |
Table 19. Finance charges assessed after the second invoice correction
Invoice number | Month ID | Finance charge date | Chargeable amount | Finance charge amount | Total chargeable amount due | Charge type | Finance charge removed? |
---|---|---|---|---|---|---|---|
101 | 1 | 1/2/2013 | $100.00 | $2.00 | $102.00 | Retroactive | Yes |
101 | 2 | 2/2/2013 | $102.00 | $2.04 | $104.04 | Retroactive | Yes |
101 | 3 | 3/2/2013 | $104.04 | $2.08 | $106.12 | Retroactive | Yes |
101 | 1 | 1/2/2013 | $100.00 | - $2.00 | $102.00 | Removal | No |
101 | 2 | 2/2/2013 | $102.00 | - $2.04 | $104.04 | Removal | No |
101 | 3 | 3/2/2013 | $104.04 | - $2.08 | $106.12 | Removal | No |
101 | 1 | 1/2/2013 | $160.00 | $3.20 | $163.20 | Correction | Yes |
101 | 2 | 2/2/2013 | $163.20 | $3.26 | $166.46 | Correction | Yes |
101 | 3 | 3/2/2013 | $166.46 | $3.33 | $169.79 | Correction | Yes |
101 | 1 | 1/2/2013 | $160.00 | - $3.20 | $163.20 | Removal | No |
101 | 2 | 2/2/2013 | $163.20 | - $3.26 | $166.46 | Removal | No |
101 | 3 | 3/2/2013 | $166.46 | - $3.33 | $169.79 | Removal | No |
101 | 1 | 1/2/2013 | $150.00 | $3.00 | $153.00 | Correction | No |
101 | 2 | 2/2/2013 | $153.00 | $3.06 | $156.06 | Correction | No |
101 | 3 | 3/2/2013 | $156.06 | $3.12 | $159.18 | Correction | No |
Table 20. Invoices updated as follows
Invoice number | Due date | Invoice amount | Bill amount | Balance amount | Sales tax | Discount amount | Total finance charges |
---|---|---|---|---|---|---|---|
101 | 1/1/2013 | $100.00 | $100.00 | $99.18 | 0 | 0 | $9.18 |
101-R1 | 1/1/2013 | $60.00 | $60.00 | $60.00 | 0 | 0 | 0 |
101-R2 | 1/1/2013 | - $10.00 | - $10.00 | $0.00 | 0 | 0 | 0 |
Example 6: Finance charges with a gap; payment made; corrections made; retroactive charges apply
Preconditions
Customer with an overdue invoice, with a payment made of $50.00.
Table 21. Invoices updated as follows
Invoice number | Due date | Invoice amount | Bill amount | Balance amount | Sales tax | Discount amount | Total finance charges |
---|---|---|---|---|---|---|---|
101 | 1/1/2013 | $100.00 | $100.00 | $96.12 | 0 | 0 | $6.12 |
101-R1 | 1/1/2013 | $25.00 | $25.00 | $25.00 | 0 | 0 | 0 |
Table 22. Finance charges
Invoice number | Month ID | Finance charge date | Chargeable amount | Finance charge amount | Total chargeable amount due | Charge type |
---|---|---|---|---|---|---|
101 | 1 | 1/2/2013 | $100.00 | $2.00 | $102.00 | Regular |
101 | 2 | 2/2/2013 | $102.00 | $2.04 | $104.04 | Regular |
101 | 3 | 3/2/2013 | $104.04 | $2.08 | $106.12 | Regular |
101 | 4 | 5/2/2013 | $56.12 | $1.12 | $57.24 | Regular |
101 | 5 | 6/2/2013 | $57.24 | $1.14 | $58.38 | Regular |
Results
Table 23. Finance charges assessed after the second invoice correction
Invoice number | Month ID | Finance charge date | Chargeable amount | Finance charge amount | Total chargeable amount due | Charge type | Finance charge removed? |
---|---|---|---|---|---|---|---|
101 | 1 | 1/2/2013 | $100.00 | $2.00 | $102.00 | Regular | Yes |
101 | 2 | 2/2/2013 | $102.00 | $2.04 | $104.04 | Regular | Yes |
101 | 3 | 3/2/2013 | $104.04 | $2.08 | $106.12 | Regular | Yes |
101 | 4 | 5/2/2013 | $56.12 | $1.12 | $57.24 | Regular | Yes |
101 | 5 | 6/2/2013 | $57.24 | $1.14 | $58.38 | Regular | Yes |
101 | 6 | 7/2/2013 | $58.38 | $1.17 | $59.55 | Retroactive | Yes |
101 | 7 | 8/2/2013 | $59.55 | $1.19 | $60.74 | Retroactive | Yes |
101 | 1 | 1/2/2013 | $100.00 | - $2.00 | $102.00 | Removal | No |
101 | 2 | 2/2/2013 | $102.00 | - $2.04 | $104.04 | Removal | No |
101 | 3 | 3/2/2013 | $104.04 | - $2.08 | $106.12 | Removal | No |
101 | 4 | 5/2/2013 | $56.12 | - $1.12 | $57.24 | Removal | No |
101 | 5 | 6/2/2013 | $57.24 | - $1.14 | $58.38 | Removal | No |
101 | 6 | 7/2/2013 | $58.38 | - $1.17 | $59.55 | Removal | No |
101 | 7 | 8/2/2013 | $59.55 | - $1.19 | $60.74 | Removal | No |
101 | 1 | 1/2/2013 | $125.00 | $2.50 | $$127.50 | Correction | No |
101 | 2 | 2/2/2013 | $127.50 | $2.55 | $130.05 | Correction | No |
101 | 3 | 3/2/2013 | $130.05 | $2.60 | $132.65 | Correction | No |
101 | 4 | 5/2/2013 | $82.65 | $1.65 | $84.30 | Correction | No |
101 | 5 | 6/2/2013 | $84.30 | $1.68 | $85.98 | Correction | No |
101 | 6 | 7/2/2013 | $85.98 | $1.72 | $87.70 | Correction | No |
101 | 7 | 8/2/2013 | $87.70 | $1.75 | $89.45 | Correction | No |
Table 24. Invoices updated as follows
Invoice number | Due date | Invoice amount | Bill amount | Balance amount | Sales tax | Discount amount | Total finance charges |
---|---|---|---|---|---|---|---|
101 | 1/1/2013 | $100.00 | $100.00 | $64.45 | 0 | 0 | $14.45 |
101-R1 | 1/1/2013 | $25.00 | $25.00 | $25.00 | 0 | 0 | 0 |
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