Help with HP payments ASAP
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A company has purchased a forklift on HP for 20000.
They paid 13000 lump sum which goes through bank. I have a huge difference on my Purchase Ledger Control a/c, what Journal do I put through for those HP paymentd made through the year :roll:
They paid 13000 lump sum which goes through bank. I have a huge difference on my Purchase Ledger Control a/c, what Journal do I put through for those HP paymentd made through the year :roll:
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Re:Help with HP payments ASAP
From the start, this is what i'd do
Dr FA 20,000
Cr Bank 13,000
CR HP Account 7,000
Then through the year, payments are made....
Dr HP Account (amount paid)
Cr Bank (amount paid)
However...a part of these payments will be interest, which will leave the amount owing in the HP account incorrect
Dr HP interest (interest part of payments)
Cr HP account (interest part of payments)
This is what i'd do. TOTALLY my opinion. Hope it helps a little though.
Kate
xxxx
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