Recording Lease Interest

The Record Lease Interest page lets you recognize the interest amount per period. The interest amount is taken from the lease amortization schedule of the lease record. A link to the associated Lease record will be available in the Interest journal.

To use this feature, you must create the set up additional GL accounts. For more information, see Setting Up General Ledger Accounts for Lease Accounting

To record the interest incurred on your leased assets:

1. Go to Fixed Assets > Leases > Record Lease Interest.

2. Provide values for the following fields:

   • Date – Enter a date for the lease payments.

   • Subsidiaries – Select the subsidiaries of the leased assets.

3. Click Record Interest.

   Note:

   You can record interest only for Lease records with an Asset Created status.

The system creates an interest journal for all lease payments without a lease interest, dated on or before the date entered. A link to the interest journal entry is available in the Lease Amortization Schedule subtab in the Lease record.

The interest journal lines are as follows:

• For finance lease:

  • Debit to Interest Expense

  • Credit to Lease Liability

• For operating lease:

  • Debit to Accumulated Depreciation – Right-Of-Use Asset

  • Credit to Lease Liability

Note:

The GL accounts used in the interest journal is sourced from the accounts that you set in the Posting Reference subtab of the Lease record. The journal created is automatically approved if it is created by a user with permission to approve journals or if Require Approvals on Journal Entries is disabled. The journal will be set to pending approval if the preference is enabled and will be create by the user without journal approval permission.

General Notices