Enter a unique ID (up to 11 characters) and a description (up to 30 characters) for this finance charge. If you no longer use this finance charge, mark the Inactive checkbox. When this checkbox is marked, the finance charge will not be included in any finance charge fields in the application.

Use the fields in this section to define how the application calculates finance charges.

• Annual rate. Enter the annual percentage rate for this finance charge.
• Grace period after due date. If your client allows its customers a specific amount of time after the due date to submit payments before it assesses finance charges, select the number in the first field, and then select the unit (Days, Months, or Weeks) for the grace period.

  To include prior finance charges in the total when calculating finance charges, mark the Compound checkbox.

• Calculate from. Select the date from which to start the finance charge calculation - Due date, Due date + grace period, or Invoice date.
• Minimum finance charge. If the client charges a minimum finance charge, enter that amount in this field. If the calculated finance charge is greater than zero but less than the minimum total finance charge, the application assesses this amount for the finance charge.

Enter or select the GL account to use for finance charge transactions. If the finance charge is taxable, mark the Taxable checkbox.

Enter the minimum amount that the customer can carry as the past-due balance before the application calculates the finance charge. The application sums the amounts for all invoices that are past the due date plus any grace period as of the finance charge assessment date and compares it to the amount entered in this field. If the calculated amount exceeds this amount, the application will assess the finance charge.

Examples. A customer has two invoices (one for $45.00 and one for $55.00) that are past due as of the finance charge assessment date and an unapplied credit memo for $25.00.

• If you enter 100 in this field, the application will not calculate the finance charge because the invoices total does not exceed the threshold amount.
• If you enter 90 in this field, the application will calculate the finance charge for both invoices even though the customer has a credit memo. The application does not include credit memos in the determination of finance charge calculations.