Chattel Mortgage Finance & purchase setup

Question

Hi,I've been using MYOB since version 8 but have not until now had to setup a capital purchase with chattel mortgage finance. I've followed the advice from Ron Boulton (https://community.myob.com/discussions/tax_bas_gst_eofy/capital-purchases-and-finance-in-accountright/389248) and it all looks fine EXCEPT the Unexpired Interest.Following the method given in this reference I end up with a negative amount in the Unexpired Interest (2-xxxx) account. Upon making repayments the value in that account moves what appears to be the wrong way, ie the absolute magnitude value increases. eg initial value of unexpired interest after setup is, say, -$7000.00. Regular repayment is say, $250 comprising $200 principal and $50 interest. After posting that entry I'd end up with Unexpired Interest account with a balance of -$7050.00&nbsp;I can't see where I've done anything incorrectly, but that result doesn't look right and I can't see that anyone else is having the same issue. Maybe I'm just looking at it wrongly and just being as thick as a brick but I would REALLY appreciate some advice on this.Thank you.Lance

mike_james · Answer

Hi Eljay1959 , My preference would be for you to allocate the entire regular payments (both principal and interest) to the loan account, which after the set-up entries includes all future interest. Then have your accountant work out and adjust for the new amount of unexpired interest at the end of each year. This will be simpler for both of you.

eljay1959 · Answer

Thanks Mike_James ,&nbsp; that does sound like a simpler solution. In this case though, the client wants an updated interest outstanding figure more frequently than annually - but that's easy enough to do in a simple spreadsheet.&nbsp; It's just getting MYOB to do it that appears a bit tricky.&nbsp;&nbsp;Thank you again for your advice. VVery greatly appreciated.&nbsp;

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Chattel Mortgage Finance & purchase setup

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