An accounting amortization schedule is a table that shows how a loan’s payments will be divided over the loan’s duration. It breaks down the total loan amount into payments of interest and principal. A person can use this schedule to calculate how much they owe and when they will need to pay the loan off. The table will also display the payments that they have already made, and how much they have left to pay.
The accounting amortization schedule may be created in TValue or ToolBox CS. To use it in TValue, you must use the Detail tab on the Actions -> Enter Payables screen. Click the Amortization Schedules tab and choose the correct GL account or 1099 item to import the schedule data.
An accounting amortization schedule can be helpful for a business to understand how much its costs will rise and fall over time. It is also used by investors to calculate their loans and deduct interest payments for tax purposes. A depreciated asset reduces a company’s taxable income and tax liability, giving the investor a better idea of its true earnings over time. A sample amortization schedule is shown below.
An amortization schedule can be complicated, and it is wise to seek assistance from an accounting software that will streamline the process and limit the chance for error. In accounting, amortization applies to tangible and intangible assets with a discernible useful life. A useful life is defined as the period for which an asset will be useful to the owner.