Bit Of Maths Help Needed Please ... Im Not Well And Cant Concentrate ... :(

[joko]

i have to re-submit a long overdue invoice, adding interest etc ... but i've got the lurgy and can't do it -
(and to be honest even if i was well, i'm not all that sure i could anyway! haha)

can someone do this calculation for me please?

the original amount due was £7000.

The job ended on the 17th of august 2012 and i agreed to wait a maximum of 90 days to be paid.
it is obviously almost a year and half later and i want to calculate it up to the end of this week

this is the formula i have been provided with to work it out -

~

Interest is charged on the gross amount of the sum owed including VAT.

Interest accrues from the day after the stipulated payment date.
So if payment was to be made within 30 days, interest begins accruing from day 31.

Calculating the statutory interest rate: the rate of interest used is 8% above the Bank of England interest rate (currently 0.5%) ie 8.5%

* The annual statutory interest would be debt x 0.085 = £xx.xx.

* Then divide the annual statutory interest by 365 to get the daily interest.

* Then multiply the daily rate by the number of days that have accrued (calculate up to the date that the new invoice is being issued).



~ I just need to know what to write on the invoice really.

and also someone could tell me the amount this would go up weekly - in case of more delays and i have to submit it again in a few weeks.


i know i can also add a late fee of £70 to this

many thanks

[New Judge]

18th August 2012 to tomorrow is 552 days.

£7000 x 8.5% = £595 per annum

£595/365 is £1.630137 (interest per day)

18th August 2012 plus 30 days is 16th September 2012 so due payment date is 17th September 2012

17th September 2012 to tomorrow is 522 days.

£1.630137 x 522 = £850.93 (Total interest due)

[sunny-dave]

NJ is correct in his calculations - but I think joko agreed to wait for 90 days rather than 30 days, so the interest should be for 462 rather than 522 days

462 x £1.630137 = £753.12

[New Judge]

Yes, reading the question again I think you're correct, Dave. I read the bit about thirty days but now think that was given to demonstrate the principle.

Perhaps joko could clarify for us.

And I forgot to answer the supplementary question. Weekly the debt would increase by (£1.630137 x 7) which is £11.41.

[joko]

Thanks so much New Judge and Sunny Dave, that's great!

Sorry about the confusion, yes I agreed to wait 90 days - and the bit about 30 days is more of an example that the union sent me to help me calculate the amount

[Stuart-Elmes]

There's an online calculator to help you work out how much interest to charge on a late payment here:

http://www.mycreditcontrollers.co.uk/late_payment_interest_calculator.html