Loan treatments

Save Share

This query is : Resolved

Ramkrishna (Querist)

24 April 2015 A TRANSPORT COMPANY HAS PURCHASED HEAVY VEHICLE ON LOAN. THE COMPANY HAS NOT PAID 2 OR MORE INSTALMENT IN THE VERY YEAR.

1. THE CLAIM FOR INTEREST IN THE BOOKS WILL BE FROM ALL 12 INSTALMENT TO BE PAID IN THE YEAR OR ONLY ON THE PAID INSTALMENTS.

2. THERE ARE SOME BOUNCE CHARGES & OVERDUE CHARGES. SHOULD IT BE ADMITTED IN BOOKS.

3.WHEN LOAN SQUARED UP CERTAIN DISCOUNTS ON OVERDUE CHARGES IS GRANTED.SHOULD IT BE TAKEN AS INCOME IN THE YEAR.

IN ALL I HAVE ASSUMED THAT FIRST INTEREST PART IS PAID OFF THEN PRINCIPAL. AM I RIGHT IN APPROACH.

WITH REGARDS

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

24 April 2015 1. Claim for interest in the books will be for all 12 installments.
2. All bounce charges and overdue charges has to be admitted in the books.
3. Discounts granted should be taken as income in the year.
Your are not right a part payment towards principal will be there in each installment. You can seek break up for this.

Message likes : 1 times

Ramkrishna

Ramkrishna (Querist)

24 April 2015 SUPPOSE EMI IS OF RS. 20,000.00. I HAVE TO PAY IN 1 YEAR 20,000 X 12= 2,40,000.00 BUT I PAID 10 EMI OUT OF 12. THIS MEANS I HAVE PAID 2,00,000.00. INTEREST IN 12 EMI TOTALS TO SUPPOSE 180000.00 AND PRINCIPAL 60000.00. NOW WHEN I CONSIDER ALL 12 EMI INTEREST PAID THEN ONLY BALANCE 20000.00 WILL BE ADJUSTED TOWARDS PRINCIPAL. THATS WHY I HAVE ASKED ABOUT THE CORRECTNESS MY APPROACH.

Ramkrishna

Ramkrishna (Querist)

24 April 2015 N IF I HAD JUST PAID ONLY 3 INSTALMENTS AND CLAIM 180000 AS INTEREST. 60,000.00 MINUS 1,80,000.00 = - 1,40,000.00. THEN WHERE I SHOULD ADJUST THE 1.40 LAC AMOUNT.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

24 April 2015 That is not correct approach treat only the content of interest in installments as paid.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

24 April 2015 1,40,000 will shown under sundry creditors.

Ramkrishna

Ramkrishna (Querist)

24 April 2015 ACCOUNT DESCRIPTION OF CREDITOR - SHALL IT BE THE FINANCER NAME?

THE EMI DUE DATE FALLS ON 02/04/2015. IT WILL MEAN THAT THE EMI INCLUDE INTEREST UPTO 31 MARCH 2015.THEN CAN WE HAVE TO TAKE CONSIDERATION OF THE INTEREST PART OF THE EMI IN THE 2014-15.

THANKS

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

24 April 2015 Yes it is financier name.
Yes interest part should in 2014-15.

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now