Merchant Funds and T-Accounts

Important: The AR Automation feature is open to customers who have the following:

• a single Ledger 
• use a single currency
• and primarily process credit card payments (ACH is planned for a later release)

If you would like to know more about this feature, please send an email to licensing@accountingseed.com.

Overview

When Cardknox is set up as a Payment Processor, your Bank GL Account, a new Merchant Bank GL Account (cannot be the same as the Bank GL Account) and a new Merchant Fees GL Account are identified. Cash Receipts from all Cardknox payment processing, initially post to this Merchant Bank GL Account. The Merchant Download job then moves the funds from this GL Account to the Bank GL Account through the Journal Entry Lines.

The following T-Accounts illustrate this process for a sample set of transactions. For the first Billing, the payment is processed for $100.00, and the Cash Receipt debits the Merchant Bank GL Account and credits the Unapplied AR GL Account. The second payment for $200.00 is similarly processed. 

Note: Click here to view the above image in full screen. 

When the batch is settled in Cardknox, and the Merchant Download job runs, it creates Journal Entry Lines to move the funds (total amount of all the Cash Receipts in the batch) from the Merchant Bank GL Account to the Bank GL Account, while the other two lines show the movement of fees charged by Cardknox out of the Bank GL Account and debiting the Merchant Fees GL Account.

Note: Click here to view the above image in full screen. 

Convenience Fees

Convenience Fees can be automatically charged for payments that your customer directly pays you (PaymentSITE payments). This is similar to the PaymentLink feature from Stripe. If Convenience Fees have been enabled in Cardknox and in Accounting Seed, the Merchant Download job will make an adjustment on the Billing Cash Receipt. The Cash Receipt is created for the gross amount (Paid Amount + Convenience Fees). Therefore, when the Billing Cash Receipt is created, the Paid Amount is set as the Applied Amount and the Convenience Fee amount is set as a negative amount in the Adjustment Amount field. The Convenience Fees GL Account value from the associated Payment Processor on the Billing will be set as the Adjustment GL Account. The T-Accounts below illustrate this use case.

Note: Click here to view the above image in full screen. 

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Summer '23 Release

Release Notes and Schedule

This article was new with the Summer '23 release.