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2.Set Defaults

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2.Set Defaults

Enter the accounts receivable information: Note that the terminology Installment (or Contract) charge account is used for customers who have a fixed monthly payment. Revolving charge accounts are those whose minimum payment each month is a percentage of the total outstanding balance. Unless you specify a monthly payment amount, the customer automatically has a Revolving charge account.

 

Revolving Minimum Payment*} Type the minimum payment to appear on statements for revolving charge account customers.

 

Type a percentage in the Percent column. The current month’s minimum payment due will appear on statements as this percentage of the outstanding balance. If a customer’s balance were $3575 and you require 5% minimum payment, then the customer will be required to pay at least $178.75 before the next statement.

 

You can set a minimum dollar figure for the payment due by typing in an amount in the ’$ minimum’ column. For example, if a customer’s balance were $172 and your minimum payment were 10% — that would amount to $17.20, but you could enter $20.00 as the $ minimum which would override the $17.20.

 

Revolving Account Past-Due Charge *} Type the penalty or charge for past-due payments on revolving charge accounts.

 

In the Percent column, type the penalty amount as a percentage of the one month overdue payment amount to charge for past-due payments. For example, if your percentage is 7% and the customer is past-due a total of $50, but of that $30 is one month past-due, then the past-due charge will be calculated to be 7% × 30 = $2.10.

 

You can set a Minimum dollar figure for the past-due charge by typing in an amount in the $ minimum column. For example, in the above example, the past-due charge amounted to $2.10. However if you assess a minimum past-due charge of $5.00 enter $5.00 as the $ minimum which would override the $2.10.

 

You can set a Maximum dollar figure for the past-due charge by typing in an amount in the $ maximum column. For example, in the above example, the past-due charge amounted to $2.10. However if you assess a maximum past-due charge of $1.50 enter $1.50 as the $ minimum which would override the $2.10. The $ Maximum may be regulated by state law.

 

Revolving Annual Primary Interest Rate *} Some states permit a primary interest rate percentage on account balances up to a specific dollar figure, say $1000.00, beyond which a lower interest rate is allowed. Enter the primary interest rate on an annual basis.

 

This rate will be used for all revolving accounts unless you enter a special rate on the customer’s balances screen, where you can specify an exclusive rate just for that customer, or you can specify no interest at all for that customer.

 

Revolving Annual Secondary Interest Rate *} If a customer’s balance is higher than the Bracket For Secondary Interest Rate, this interest rate will be charged for the amount over the bracket.

 

Bracket For Secondary Interest Rate *} The primary interest rate will be charged on amounts below this amount, and the secondary interest rate applies to account balances over this amount. If you have a fixed interest rate regardless of the customer’s balance, enter the primary interest in this field too.

 

If you want to charge the same interest rate for all charges regardless of the amount, type the number 999999.99 in this field. Since no charge amount will ever exceed this amount, the system will always charge the primary interest rate on revolving charge accounts.

 

Installment Account Annual Interest Rate *} Enter the annual interest rate that will be charged to customers with installment  charge accounts.

 

Installment Account Past-Due Charge *} Type the penalty or charge for past-due payments on Installment charge accounts, which you can set to be the same as or different from the past-due charge for revolving accounts.

 

See the Revolving Account Past-Due Charge section above for details on how the past-due charges are calculated.

 

Minimum Payment Based On*} Above, where you set the revolving charge account minimum payment, the percentage is usually the percentage of the total outstanding balance. However, if you do not require that customers make any payment for a few months, this option lets you specify for how many months the customer doesn’t have to make a payment. If you choose 90-Days, the customer has 90 days before any payment is due and no require minimum payment will show on the customers’ statements before then. If you choose Total Balance, the minimum payment will appear on the first statement printed after the sale.

 

Finance Charge Plan *} Four plans are available to you for the calculation of finance charges. Look over the choices, and select the one that best suits your accounting methods. Note that you can suppress finance charges for particular customers while the rest are charged regular finance charges. The suggested choice below is C.

 

Plan A will assess finance charges on the portion of customer balances that is over 90 days old.

 

Plan B will assess finance charges on the portion of customer balances that is over 60 days old.

 

Plan C will assess finance charges on the portion of customer balances that is over 30 days old.

 

Plan D will assess finance charges on the entire customer balances. This option is not recommended because it could lead to charging a full month’s interest on the portion of balances which were made shortly prior to closing the month, and would have only been on the books for a few days. I.E., this could cause you to charge a full month’s interest on balances that are just a few days old.

 

Plan E will assess finance charges on a customer's entire statement balance from the previous month if that balance was not paid in full. This plan will not assess finance charges on sales that have occurred since the last statement. This plan is like the one used by most major credit card companies such as Visa, but is uncommon for in-house charge accounts.

 

Plan F will assess finance charges on each account’s average total daily balance, including sales made in the current period. This plan is equivalent to charging customers interest from the first day they charge a sale. Note that the average daily balance is updated each day after you run a Z–report. You must run a Z–Report (see Cash Register Maintenance) at the end of each working day to obtain accurate results for this method.

 

Plan G will not assess finance charges on any statements, even for those customers set up to receive finance charges.

 

Charge Only On Past Due Accounts?*} If you don’t want to charge your customers interest if they at least make their minimum required payment, you can set this option to Y. That way only customers who are past-due (i.e. who have not made the minimum payment) will be assessed finance charges. This is similar to not charging any interest at all and only charging past-due penalties as described above. However, the calculation is a bit different since the interest is calculated on the customers’ outstanding balances as chosen above in the Finance Charge Plan, whereas the past-due charge is based on the amount that is past-due.

 

Past-Due Plan*} Four plans are available to you for aging past-due amounts. Look over the choices, and select the one that best suits your accounting methods. The suggested choice is D — Age Past-Due Amounts.

 

Plan A will not carry forward a past-due amount charge if a customer has made any payment during the past period, even if the payment was not the full minimum payment due.

 

Plan B will assess past-due charges for any amount past-due. This includes non-payment or only partial payment of the minimum due.

 

Plan C will not carry forward past-due amounts even if no payment was made.

 

Plan D will age and carry forward any past-due amount that has not been paid. This choice is the preferred one.

 

Print Regular Price On Statement for Discounted Items?*} The month-end statements show each item that was purchased that month and their actual selling prices. If you choose Y for this option then any item which you marked down will show on the statement with a message indicating both the selling price and the regular price.

 

Are The Statements Laser Printed? (0=No, 1=Laserjet II, 2=LaserJet III)*} The Jewelry Shopkeeper can print statements either using dot-matrix printers with pre-printed continuous-feed forms from NEBS, or it can print them on plain paper using a Hewlett Packard LaserJet printer. If you have a LaserJet III or higher, choose 2 to take advantage of it’s internal scalable fonts. If you have a LaserJet II or compatible, choose 1. If you don’t have a LaserJet printer, choose 0 to print on a dot-matrix printer. (Try NEBS form 12469 if you have a laser printer.)

 

When all of the accounts receivable defaults have been entered, the System Maintenance Menu will re-appear.