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Receivables then determines which debit items should be assessed finance charges. If you set the Charge Finance on Disputed Items field to No, then the dispute amount of the debit item must be zero. Lastly, the Finance Charge field in the Customer Profile Classes window must be set to Yes for the customer of this debit item.

Consider the following example in which a customer has the following debit and credit transactions and you run the dunning program on December 1, 1993. Assume that Days in Period = 30, Interest Rate = 10% for USD and Payment Grace Days = 0.

Class	Number	Currency	Due Date	Amt Due Remaining
Payment (Unapplied)	PMT1	USD		$-50
Payment (On-Account)	PMT2	USD		$-20
Credit Memo	CM1	USD		$-10
Credit Memo	CM2	USD		$-100
Invoice	INV1	USD	01-NOV-93	$100
Invoice	INV2	USD	17-NOV-93	$50
Invoice	INV3	USD	19-NOV-93	$350
Invoice	INV4	USD	24-NOV-93	$175
Table 1 - 47. (Page 2 of 2)

This customer has a total credit amount of $180 (-50 + -20 + -10 + -100). When Receivables applies the credit to the debit items starting with the oldest one first, $320 of INV3 and the full amount of INV4 remain for finance charges. Using the dunning as of date of December 1, 1993, Receivables calculates the following finance charges:

INV3	.1 * $320 * 12 = $12.80 30
INV4	.1 * $175 * 7 = $12.80 30

Debit Item	Due Date	Dunning As of Date	Days Late	Remaining Amount	Finance Charges
INV3	19-NOV-93	01-DEC-93	12	$320	$12.80
INV4	24-NOV-93	01-DEC-93	7	$175	$4.08

If the calculated finance charge amount for an invoice is greater than the maximum interest amount per invoice in currency Y which you have specified in the customer's site level credit profile for customer site A, then Receivables uses the maximum interest amount rather than the calculated amount as the amount of the finance charges assessed on this invoice for this statement submission.

Receivables lets you define different finance charges interest rates and maximum amounts of finance charges per invoice for different currencies in the Customer Profile Classes window. For each currency, you can also define the minimum customer balance for finance charges as well as the minimum invoice balance for finance charges. Receivables does not calculate finance charges on past due items in currency Y for customer site A if the customer's balance at this site is less than the amount you specified for the Minimum Customer Balance for Finance Charges in currency Y in the customer profile for site A. Similarly, Receivables does not assess finance charges on invoices in currency Y from customer site A which are past due if their respective balances are less than the amount that you specified for the minimum invoice balance for finance charges in the customer profile for site A.

Receivables computes and prints a transaction record of your finance charges for a customer from the last time that you created a statement for this customer on which finance charges appeared. For example, if you do not create a statement for customer site A for one month, Receivables calculates and prints a transaction line with finance charges for two months when you create a statement for customer site A that includes finance charges the following month. If you have never assessed finance charges on an invoice associated with customer site A, Receivables calculates finance charges using the item's due date and the number of receipt grace days that you specified for the credit profile of customer site A. If you calculate finance charges for a debit item that you entered in a foreign currency, Oracle Receivables uses the exchange rate that was entered for the debit item against which the charges are calculated.

See Also

Setting Up Receivables to Calculate Finance Charges