10523     ENTRY NO. 23 [CLAIM IS FILED FOR PAYMENT ON INSTALLMENT PURCHASE OR CAPITAL LEASE CONTRACT]
(Revised 9/90)

Nature of Transaction:

Claim is filed for payment on installment purchase or capital lease (lease-purchase) contract.

Journal Entry for General Ledger Accounts:
Debit:
4210 Installment Contracts Payable a/
4220 Lease-Purchase Contracts a/
9000 Appropriation Expenditures b/
Credit:
2920 Amount to be Provided for Other Long-Term Debt a/
3020 Claims Filed b/
 
a/ Amount of payment made on contract excluding any interest, maintenance or other operating costs.
b/ Total amount of claim.

Source:
Document:
Claim Schedule
Explanation:
At the time an installment purchase or capital lease (lease-purchase) contract is executed an asset is recorded in the General Fixed Asset Account Group for the "principal" amount of the contract along with a long-term liability (see Standard Entry No. 22.). As claims are filed for contract payments, the total amount of the claim is charged to expenditures. However, the liability is reduced only for the amount of the payment applicable to the principal, excluding any interest, maintenance, or other operating costs.
Note:
This entry would normally be included in Entry No. 3. It is shown here separately for clarity.