Interest Calculation with Penal Interest on Overdue Bills @ Tally.ERP9

Query

How is the Penal Interest calculated on overdue bills?

Answer

The interest parameter set for the invoice raised to Blue Nile Stationeries is as shown below:

In the interest parameter setting, mentioned above, 12% interest p.a. is charged from the Due date till Feb.28. If the bill is pending beyond this date, a penal interest is set to be charged from the date of invoice, i.e. Feb.1, without giving the user the benefit of a credit period (the user may configure the same as required).

To view the report:

Go to Gateway of Tally > Statements of Accounts > Interest Calculations > Ledger > Blue Nile Stationeries