Cash Application in Centime

Modified on Fri, 17 May 2024 at 09:33 AM

Summary: How Centime reconciles payments made through CentimePay.


TABLE OF CONTENTS

Overview

When a customer makes a payment using CentimePay, Centime automatically applies cash appropriately and closes out the bill in your general ledger. Centime also applies cash to the corresponding accounts for early-pay discounts, ACH discounts, credits, and surcharges for payments made in the Customer Portal. 

How it Works

When a customer authorizes a payment through CentimePay, Centime will post the Payment to the “Undeposited Funds” GL account until the funds settle. Once they settle, a Deposit will be created in that amount to correspond with your bank balance.

Payment Posting  

Centime creates a payment and posts it to the “Undeposited Funds” GL account until the funds settle with the bank. The previous journal entry reflects the reduction from "original amount" to "amount due." 

Once funds settle, Centime creates a Deposit and posts it to the bank register to coincide with when cash clears the bank account for easier reconciliation. This way, the bank balance in your General Ledger will align in real-time with the balance from your financial institution. 

The memo will also display the customer name followed by the invoice number to match what is populated on the bank statement for easier reconciliation. This will also be reflected in your bank register. 

Discounts and Surcharges

In the event that discounts or surcharges are utilized, a journal entry will be created for the surcharge or discount amount and assigned to the GL accounts designated in the Online Payments Settings and the customer. 

Discount Posting

For Discount-related transactions, this journal entry will act as a credit memo reducing the invoice amount for your customer while keeping your books balanced. 

Surcharge Posting

For Surcharge-related transactions, a Journal entry will be created against the surcharge account selected in Centime. 

The Payment will be posted (as a Journal) to 'Undeposited Funds' until the funds clear the bank. 

Once the funds clear your financial institution, Centime will create a Deposit in your General Ledger.


The memo will also display the customer name followed by the invoice number to match what is populated on the bank statement for easier reconciliation. This will also be reflected in your bank register.



Summary & General Ledger Examples  

1. Undeposited funds: Record payment amount against holding account - Authorisation

        -Record surcharge using journal entry against holding account - Authorisation

3. Deposit: Record total deposit against bank account -  Payout initiation

Netsuite  

  • Invoice amount: $116.9 

  • Surcharge: $3.1

  • Payment: $120

1. Payment posting: Undeposited funds 

2. Surcharge: Journal entry 

2. Deposit 

4. Bank Register

QuickBooks Online 

  • Invoice amount: $500

  • Surcharge: $5 

  • Payment: $505

1. Payment posting: Undeposited funds 

2. Surcharge: Journal Entry

3. Deposit

QuickBooks Desktop 

  • Invoice amount: $1000

  • Surcharge: $29 

  • Payment: $1029

1.  Payment posting: Undeposited funds

2. Surcharge: Journal entry

3. Deposit


4. Bank register

Sage Intact

  • Invoice amount: $100
  • Surcharge: $2 
  • Payment: $102

1. Payment: Undeposited funds

2. Surcharge posting: Undeposited funds

3. Deposit






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