To activate interest calculation
1. Go to Gateway of Tally > F11: Features > Accounting Features.
2. Set Activate Interest Calculation to Yes.
3. Set Use Advanced Parameters to No.
Interest calculation on outstanding balances is allowed for any ledger account. Configure the interest rate and style of calculation in the ledger master to start calculating interest on outstanding amounts.
To enable interest calculations on outstanding balances
1. Go to Gateway of Tally > Accounts Info.> Ledgers > Alter (Single) > XY Bank (bank account)
2. Set Activate interest calculation? to Yes. The Interest Parameters screen appears.
3. In the Calculate Interest Based On? field select the Date Type, as required.
4. Enter the rate of interest in the field Rate.
5. Select the interest style, as required. The rate of interest will be calculated on the basis of the interest style applied.
Note: If the interest style selected is 365-day Year, then the interest will be calculated for 365 days irrespective of the number of days in the calendar year. If Calendar Year is selected as the interest style, then the rate of interest will be calculated on 365 days or 366 days, depending on the number of days as per the calendar.
6. Press Ctrl+A to accept details in Interest Parameters screen.
7. Select required details in other fields of Ledger Creation screen.
8. Press Ctrl+A to save.
To view Interest Calculations Report
● Go to Gateway of Tally > Display > Statements of Accounts > Interest Calculations > Ledger > XY Bank (Bank Account)
Interest calculation can be done bill-by-bill for accounts grouped under Sundry Debtors and Sundry Creditors.
To activate interest calculation for party ledgers
1. In the party ledger alteration screen, set Activate interest calculation? to Yes. The Interest Parameters screen appears.
2. Set Calculate Interest Transaction-by-transaction? to Yes.
3. Set Override Parameters for each Transaction? to Yes to change the parameters during voucher or invoice entry.
4. Enter the rate of interest in the field Rate.
5. Select the interest style, as required. The rate of interest will be calculated on the basis of the interest style applied.
To view the Interest calculated report
● Go to Gateway of Tally > Display > Statements of Accounts > Interest Calculations > Ledger
This report is similar to the bill-wise outstanding statement. The last column gives the interest amount calculated based on rate and interest style.
'Calculating Interest in Simple Mode' has been shared with
