Unearned Discount

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Unearned Discount

A finance charge a lender assesses at the beginning of a loan, but only recognizes as income gradually over the loan's life. In accounting, the unearned discount is listed at first as a liability on the lender's balance sheet, but is slowly recognized as income.
References in periodicals archive ?
I learned that un-repaid, unearned discounts could offset credits that would otherwise be turned over to the state under escheatment laws.
Fragmented across disparate systems, applications and organizational boundaries, the quote-to-cash cycle and associated processes are now fertile ground for profit loss in the form of late pays, chargebacks, write-offs, penalties and unearned discounts.
An automated business-rule capability with algorithm-based problem detection and exception-based reporting can monitor and highlight those exceptions likely to result in late pays, chargebacks or unearned discounts.
The quote-to-cash cycle and associated processes are ripe for profit loss in the form of late pays, charge-backs, write-offs, penalties and unearned discounts.
Let's begin with the principle, that what we might call indirect or unintentional promotional funding (slotting allowances, abuse of unsaleables policies, unearned discounts, deductions and all the other dark demons of the 1980s and 1990s), which ought not to be the basis of profitability.
Suppliers benefit from improved cash flow, more predictable payments, and less profit leakage from unearned discounts.
If left unchecked, your company could be losing millions of dollars a year with these unearned discounts.
The solution offers management the ability to monitor cash forecasts, risk exposure, root-cause analysis, resource performance, earned and unearned discounts and collections effectiveness for the entire enterprise, or for a specific business unit.
Coding, tracking and rolling up deductions or unearned discounts is impossible.
With CashApply, Delta has been able to automate over 20 percent of its payment transactions and achieve a hit rate of over 90 percent, while simultaneously reducing the value of open chargebacks and increasing the value of unearned discounts charged back by 100 percent.
Good communication is truly important between Cash Applications and the Credit Department--the process of researching and addressing deductions, short-pays, unearned discounts, and other pay habits starts with the Cash Application area.
77% Undisbursed loan funds (30,536) (27,917) Deferred loan (fees) costs (27) 51 Unearned discounts (14) (20) Allowance for loan and lease losses (6,579) (6,068) Total loans held for investment, net $ 593,554 $ 697,191 Participation loans included above $ 33,693 7.