Using Figurewizard - HP or Instalment Plan Budgets

Using Figurewizard - How budgeted HP loans are calculated

Budgeted Fixed Assets

Figurewizard assumes that both the acquisition and sale of fixed assets (tangible assets) are budgeted.  That means that the value of acquisition of the year's HP or other asset finance instalment plan in respect of fixed assets are spread over twelve months. Repayments are budgeted accordingly, which means that twelve equal HP agreements are are created in the year by our system. The table below illustrates how each month's payments are calculated.

Budgeted HP Repayments

For example: Assume an HP loan or asset finance plan by instalments of £6,000. This is credited as £500 a month for 12 months. The calculations for payment of instalments (which start one month after the budgeted loans are received) are as follows:

Month Ref: Loan Value Monthly Repayments
Month 1 £500 £0
Month 2 £500 £25
Month 3 £500 £50
Month 4 £500 £75
Month 5 £500 £100
Month 6 £500 £125
Month 7 £500 £150
Month 8 £500 £175
Month 9 £500 £200
Month 10 £500 £225
Month 11 £500 £250
Month 12 £500 £275


Budgeted Cash Flow for Fixed Asset Financing

Because the last loan applied is in month12, repayments for a  24 month HP agreement means that its last repayment occurs in month 36. In the event that fixed assets are sold before the agreements have run their course the repayments are reduced accordingly.

Interest charges are calculated and applied separately by our system in line with all of the above. Depreciation of fixed assets is also budgeted in the same way.

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