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September 2017
September 2017
Carly,
In the Liability to the Finance Company, I put the monthly amount.
It is then easy to see that the repayment is made to the correct account.
I would set up a recurring Spend Money or a Bank Rule for the monthly repayment to the Finance Company.
You can obtain from the Finance Company, a Interest Amortisation Schedule.
This will show the interest charged each month.
I prefer to enter a monthly journal entry for the interest (setup a recurring journal entry).
I also prefer to do monthly journals for depreciation using the simplified method available to SBE ie 15% and 30%.
Many Tax Accountants prefer to do annual entries for Interest and Depreciation - once again this is not my preference.
Let us know how you go.
Duncan
September 2017
September 2017
Hi @ronatbas, @DuncanS, @CarlyHutchings
The loan payment in total will be a spend money on the bank with allocation to the loan account.
Depending on the size of the small business and the depth that you want to go to in the P & L will decide whether you really need to record depreciation and interest charges on a monthly basis or you want to record them annually.
Depreciation for SBE is 15% flat in the year you purchase the capital item and then 30% each year after that, and you also need to take into account the SBE advantages presently in effect of being able to write off immediately items costing $20,000 or less (ex GST).
It is sometimes better to look at your P & L nett profit without accounting for interest and depreciation and thinking you may have a $20,000 tax bill coming up, and then factoring in these extra expenses later and then having less tax to pay.
If you do want/need to factor them in monthly, depreciation can be set as an auto record, as the monthly amount wont change.
Interest though will change each month, and reduce and will need to be obtained from the amortisation schedule if added to to the loan at the commencment.
February 2018
February 2018
Hi
I need some advice on this. Client purcahsed a vehcile on chattel mortgage via Volkswagon finance. The agreement is for two years and teh monthly repayment is say $1500 . The agreement has a guaranteed future value at the end of 24 months.
The client has paid for the 24 months and at the end of teh 24 months Volkswagon Finance has taken the vehicle back at the guarantted future value whic is also teh reamining balance owing.
How do I recoard this vehcile disposal in myob.
February 2018 - last edited February 2018
February 2018 - last edited February 2018
There are a couple of issues here that make me think that you really need to talk to the client's accountant.
A chattel mortgage implies that the vehicle was bought by the client. Was the agreement a separate document?
It will depend on the book value of the vehicle at the time of sale. The accountant will need cost of vehicle, amount of loan, amount repaid to date and date of sale.
They will then work out the depreciated value of the vehicle and if there has been a profit or loss on the sale of the vehicle.
To save me writing a lot of details of processes about if this, if that, once you have the information please come back through the main part of the forum if you need further assistance.
August 2018
August 2018
I am trying to comprehend this but in relation to MYOB Essentials. I have looked up Essential Chattel Mortgage but it only gives me details to record a Hire Purchase and this looked different to the advice posted here. It didnt use an unexpired Interest Account.
The details of the purchase are:
Amount financed: $81,000
Cost: $89,100
Minus deposit: $8,100
No balloon payment
Instalments made yearly (for 5 years) $18,983.07
Total Interest: $13,915.35
The establishment fee applies at settlement and is not financed: $401.80
I am trying to relate the advice above to Essentials so can anyone provide assistance or point me in the correct direction.
Thanks
Jo
August 2018 - last edited August 2018
August 2018 - last edited August 2018
error sorry
September 2018
September 2018
Hi There
I am currently studying bookkeeping and I had a exam and the question was Luxry car purchase with chattel mortage and trade in so it is a bit connfusing however what I did I created an account under bank (trade-in clearing) and allocated the N-T tax code. My question is when I do enrty to myob how to split luxry car and trade in basically how to do myob entry ? it is very complicated I am really stuck any help would be great.
Thanks in advance
Kind Regards
April 2020
April 2020
you had mention,
Making the final payment
but, my account shows zero from the loan account and negative from the unexpired interest account.
Example:
Credit 2-2100 ABC loan for CNC Mill $102,453.25
Credit 2-2105 Unexpired Interest on ABC loan -$12,863.05
After all the repayment (47 payments of $2137.57 and one payment of $1987.46. total $102.453.25)
Debit 2-2100 ABC loan for CNC Mill $2,137.57
Credit 1-XXXX Bank account $2137.57
This bring the 2-2100 to zero, but 2-2105 still -$12,863.05, how can I bring 2-2105 to zero?
Thanks
April 2020
April 2020
Hi everyone,
I've found this to be a great reference, but I'm missing a step. The same issue was mentioned above but I can't see a clear answer/instructions.
I have set up Unexpired Interest for the entire interest amount, and have the amortisation schedule.
I have been put the monthly interest amounts against the unexpired interest, but as someone mentioned earlier, this increases the liability.
What entry do I need to reflect the interest expense, as well as bring down that liability as each month goes by? (A screenshot would be great - I'm self-taught!)
Thanks,
Georgie
April 2021 - last edited April 2021
April 2021 - last edited April 2021
I am looking forward to seeing the response to @georgieh as I have the same query. Thank you
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