What happens to a payment plan if I make changes to the invoice?

When you add or remove a fee from an invoice on a payment plan, ASAP automatically adjusts the payment plan to account for the increase or decrease in fees. In general, what ASAP does is take the new amount, divides it by the number of future scheduled payments, and applies that figure evenly to those future scheduled payments.
 
For example, lets say you add a new class to an invoice that’s already on a payment plan, and the cost of the new class is $100. For this example we'll say that the payment plan consists of four payments of $50 each.
 
In this case ASAP will:
 
  1. take the new amount ($100)
  2. divide it by the number of future scheduled payments ($100 / 4 = $25)
  3. add that figure ($25) to each future scheduled payments
 
So if the future scheduled payments in the payment plan were $50 each before the change, they would be $75 each after the change. 
 
The same thing happens when there is a reduction in fees. In this example lets say the student is receiving a $100 discount after the payment plan was created. ASAP will:
 
  1. take the new amount, which in this case is a negative number (-$100)
  2. divide it by the number of future scheduled payments (-$100 / 4 = -$25)
  3. add that figure (-$25) to each future scheduled payment (aka subtract $25 from each future scheduled payment)
 
Using the example from above, if the future scheduled payments in the payment plan were $50 each before the change, in this case they would be $25 after the change.
 
Now in the example we just looked at, the amount being subtracted from each future scheduled payment happened to be less that every future scheduled payment ($50 - $25). But what happens when that’s not the case?
 
Say you’ve edited the last future scheduled payment to be only $10 so that one of them is less than the others (say it’s $10)? When ASAP adds or subtracts money to or from future scheduled payments, it starts with the last scheduled payment and works it’s way up. So in this case ASAP will:
 
  1. take the new amount (-$100)
  2. divide it by the number of future scheduled payments (-$100 / 4 = -$25)
  3. subtract $25 from the last scheduled payment ($10 - $25 = -$15)
  4. moving up to the next scheduled payment, ASAP will carry that extra $15 over and try and reduce it by $40, which is the $25 it was going to reduce it by plus the $15 left over from the last reduction ($50 - $40 = $10)
 
So it that case the last future scheduled payment will be $0, and the next one will be $10.
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Comments

  • Avatar
    Paul Spencer

    Thanks for this. It seems a really sensible way to set it up and I'm glad to see it being brought in.

    Can I suggest in general when you're using example figures like that, if there are two figures involved that you make them conveniently different from each other? In the first example above, the scheduled payments are $50 each and the new amount is a closely related amount of $100, which leads to potential confusion. I think it would be clearer to make the small amount, say, $60 (or else make the higher one $120), which still makes the arithmetic easy but makes them easier to mentally keep track of.

    Also a small typo in the final sentence "So it that case".

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