A finance charge memo is a document that contains information about calculated interest on outstanding balances. You use it to inform a customer that the outstanding balance is increased by an interest amount. You can also calculate and print interest on Reminders.
A finance charge memo is composed of a finance charge memo header and a number of finance charge memo lines. The finance charge memo header contains information about the customer such as name, address and finance charge terms. It also contains information about the finance charge memo such as the document date and due date. The program retrieves most of this information from the Customer and Finance Charge Terms tables.
Finance charge memo lines contain information (such as document number, due date and remaining amount) about outstanding amounts that interest is to be calculated for.
The finance charge facilities are based on the core data for each customer. They offer you extensive options, such as flexible interest rates and other fees when creating finance charge memos for your customers. You can also choose whether or not interest and/or fees should be posted to the relevant G/L and customer accounts when finance charge memos are issued.
Finance charge memos can be created automatically with the Create Finance Charge Memos batch job. This batch job creates one finance charge memo per currency for which there are customer ledger entries on which interested is calculated.
To create a new finance charge memo manually, create a finance charge memo header, and then use the Suggest Fin. Charge Memo Lines batch job.
After you have completed the finance charge memo header and associated lines, you must issue the memo.
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| Microsoft Dynamics NAV uses the open-item accounting method to calculate interest on customers with overdue amounts for open invoices and credit memos. The calculation includes both open entries where payment is overdue and closed entries where payment was late. Thus, an open invoice is included in the calculation until its full amount has been applied to a payment. Microsoft Dynamics NAV does not use the balance-forward accounting method where customer balances determine whether interest should be calculated or not. Open payments are excluded for that reason. |