Forum

• # 100754
• Tue 29 Jul 2014 09:14 PM

Can anyone advise?

A company I work for started using sage on 01/04/2014. They took out a car on HP two weeks before and paid a deposit. 

I am setting the HP agreement up on sage from 01/04/14 but am unsure how to show the £3k paid without messing up the bank account?? 

So what I know is (and do correct if I am wrong): 

Dr Motor Vehicle with cash price of vehicle

Dr HP interest with interest amount

Cr HP control with gross amount

Then future monthly payments will be Dr HP control and CR bank.

How do I show the deposit from 23/03/2014? Totally confused... 

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• # 100761
• Wed 30 Jul 2014 12:37 PM

This should be taken care of in the b/f figures from the old system

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• # 100765
• Wed 30 Jul 2014 07:10 PM

Hi,

Within Sage - click on help, then contents & index, type in hire purchase and select list topics, select 'to record the hire purchase' and select display - this will show you the correct way to post the journal and the monthly HP & monthly HP Interest payments.

Marilyn

• A clever person solves a problem.

  A wise person avoids it.

  Albert Enstein

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• # 100816
• Sun 03 Aug 2014 07:02 AM

Thanks for your replies. Unfortunately, they messed up the b/f so its not included there other than in Assets and Sage help only shows how to do it from scratch but not how to solve this issue. :(

The issue is:

The car is in Assets but there is no HP set up (no idea how they have done this - it looks like a single sided entry), they have already claimed VAT so I need to presumably need to leave this off? Also, I need to account for the cash deposit but not effect the bank balance - could this be a prepayment??

Going bonkers :/

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• # 100819
• Sun 03 Aug 2014 10:39 AM

Hi Michelle,

The only possibility I can think of (without seeing the actual sage entries) is that they have put the car into assets in Sage as an Opening Balance. If you can check the audit number in sage for the car entry then go to financials and look at this audit number and see what else is listed just before and after it should give you an idea of what has been done.

There should have been an opening balance put into the HP nominal on Sage if the car was entered this way when they started using Sage.

Sorry can't be much more help without actually seeing the audit trail in the financials.

Marilyn

• A clever person solves a problem.

  A wise person avoids it.

  Albert Enstein

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• # 100825
• Sun 03 Aug 2014 10:28 PM

VAT has been claimed on a car ? What sort of car is it ?

You need to find the errors in the previous year and correct the B/F balances.   

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• # 100837
• Mon 04 Aug 2014 10:54 AM

It is (fortunately) a business use only car (so I'm told by their Accountant). Befor emy time also...

It really is turning into out to be a bit of a mess. I am going to have to thoroughly check their audit trail.

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• # 100844
• Mon 04 Aug 2014 08:51 PM

Hi Michelle,

Usually, a deposit paid prior to set up of an HP agreement will only consist of

- full value input VAT       (whether this is reclaimable or capitalised needs researching as an aside)

- Road Fund Licence        (needs  expensing)

- an amount of the net car value that then reduces the HP loan to the pre agreed value.    (capitalise)

The Sage posting of this deposit therefore needs dissecting - the sellor's invoice / covering letter will have this detail.

The bookkeeping for the loan is then straightforward. A schedule will be issued by the lender listing monthly payments, inclusive of interest.

Dr Assets    Cr HP Liability      with the loan value excluding interest element 

Each direct debit payment then made is posted to HP Liability (capital  element) and HP Interest (P&L expense)

• Kind regards,
  PeteL  

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