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. Interest on outstanding balances can also be calculated transaction-by-transaction .
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. Set Include transaction date for interest calculation . This can be enabled For Amounts added and/ or For Amounts Deducted .
5. Enter the Rate of interest.
6. 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.
7. Select required details in other fields of Ledger Creation screen.
8. Press Ctrl+A to save.
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.
'Calculating Interest in Simple Mode' has been shared with
