Bank overdraft interest.

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Sanjib Mukherjee

Accountant

45 Points Posted on 31 July 2011

We have bank OCC or overdraft account against our stock/inventory. Suppose bank charged 14.25% p.a interest. and debited it monthly. Accordingly I have also calculating my interest but the interest amount of me is not matching with the bank. It shown that bank charged higher amount than me.

My calculation procedure are s follows.

Put the bank daily closing balance from the bank statement

then multiply it with interest rate and then devided with 365 days and when I am totaling it at the end of the month , it shown a less amount then bank has charged.

I am really confussed. If anybody is facing similiar problem or have knowledge about this please help me.

Thanks,

Sanjib

Replies (5)

narinder_6in

46 Points Posted on 28 June 2012

I am also facing the same problem using the same methid. In my case the interest rate is 16.50% - Please help

Annu Agarwal

Practice

2598 Points Posted on 12 September 2012

Well Sanjib ji the method followed by you is correct.Just ADD BACK the amount of cheque deposited but cleared by bank on the next day from the day closing balance.I think then interest calculated by youwill be equal to the one charged by bank.

Eg.On 3rd May,2012 -closing balance is 200,000/- Dr

cheque deposited on 3rd may,2012 f Rs 10,000/-,but value date shown by bank is 4th may,2012

Then take the closing balance for 3rdMay,2012 as (2,00,000+10,000) i.e.2,10,000/- for interest calulation purpose

Pradip Kr Biswas

accounts manager

27 Points Posted on 02 July 2013

DEar Sirs,

Cheques we deposited with bank give credit next day and accordingly, on dayend balance i calculate interest by the step like this.... balance Xrate of interest divided by 365 days. and month end total does not matched with the interest charged by bank. please solve the problem.

p.k.biswas.