Hi to all
Required calculation for bank interest chargeable on working capital loan
based on outstanding on daily basis.
For example:
Day 1.Deposits 10,000:withdrawls 15000 ;closing balance -5000.
Day 2.Deposits 35000:Withdrawls 20000 :closing balance 10000
Day 3.Deposits 11000:withdrawls 55000 :closing balance -34000

Assuming sancioned loan is 100000,Rate of interest is 12% per annum.Interest
is payable on amount in debit.

Thnak you

Regards

tiya

"Tiya" wrote:
Required calculation for bank interest chargeable on
working capital loan based on outstanding on daily basis.
For example:
Day 1.Deposits 10,000:withdrawls 15000 ;closing balance -5000.
Day 2.Deposits 35000:Withdrawls 20000 :closing balance 10000
Day 3.Deposits 11000:withdrawls 55000 :closing balance -34000
Assuming sancioned loan is 100000,Rate of interest is 12%
per annum.Interest is payable on amount in debit.

Your lender should be able to answer this question for you.

As I understand a commercial line of credit, your deposits
go to pay off any interest first. So in the above example,
on Day 2, your outstanding interest is 1.64 (5000*12%/365),
and your closing balance would be 9999.36 (10000 - 1.64).
In general, your outstanding interest and new balance a

interest: =if(prevBalance=0, 0, -prevBalance*12%/365)
balance: =prevBalance - interest + deposits - withdrawals

If deposits are not made on consecutive days, the accumulated
interest is:

=if(prevBalance=0, 0,
fv(12%/365, lastDepositDate - today(),, prevBalance) + prevBalance))

Addendum ....

I wrote wrote:
"Tiya" wrote:
Day 2.Deposits 35000:Withdrawls 20000 :closing balance 10000
[....]
on Day 2, your outstanding interest is 1.64 (5000*12%/365),
and your closing balance would be 9999.36 (10000 - 1.64).

Of course, you could deposit 35001.64 instead. But that is not
always as easy as it sounds.