Vehicle installment agreement

[Neville Bailey]

Motor Vehicles 6200/010 245665,00(D)
Motor Vehicle Expenses (Licence & Reg) 6200/010 3500,00 (D)
Bank Charges (Initial Fees) 3200/000 1000,00(D)
Vat 9500/000 140,00 (D)
Deferred Finance Charges (B/S) 5600/999 40055,28 (D)
Bank Charges (monthly fee [R57 x 42 months]) ?? 3200/000 2100,00(D)
Vat ?? 9500/000 294,00(D)

Instalment Sale: KIA Sportage 5600/100 292754,28(C)

You did not mention the montly fee in your journal but its included in the Total of R292754,28.

At year end do I need an amortisation schedule to write of the finance charges or can I take 40055,28/12months???????

It looks fine to me.

It's important that you set out the journal in the way I described it in the other thread, so that the VAT gets treated correctly.

You are correct with respect to the amortisation schedule at year-end. You cannot simply take 12 months of the deferred finance charges, as the finance charges are weighted heavily in the earlier months.