How do you create and accept payment for an invoice that's being financed over 12 months?

Hi Dianne,

I know that being able to accurately assess finance charges on sales is an important part of record keeping. QuickBooks Desktop has a great workflow that encompasses assessing finance charges. I can explain where to set up this feature.

To set up your Finance Charges:

1. You'll need to log in as an Admin.
2. Go to the Edit menu, and select Preferences.
3. Choose Finance Charge, go to the Company Preferences tab.
4. Enter the Annual Interest Rate, Minimum Finance Charge, and Grace Period.
5. Choose the account you want to use to track the income from the finance charges from the choices in the Finance Charge Account drop-down.
6. Select either due date or invoice/billed date to indicate when the finance charges should be calculated.
7. Select Ok.

When you wish to assess the finance charges, you will go to the Customer menu and select Assess Finance Charges. Choose the Assessment Date, Customers, and Jobs you want to assess the finance charges for. QuickBooks creates the Finance Charge Invoice per customer, you can print it or leave it to be included in your statements. You'd then record the payment for the interest and the principal amount.

As to the interest that should be added to the invoice, I suggest checking with your Accountant to be sure that you've got the most updated information for your business and area.

If you don't have one that you currently work with you can search for one through this link; Find an Accountant.

If you have any more questions please reach out. Have a great day!