About GL Association with Sample Payment Types

The sample Payment Types records included with stock Aptify are listed in the following table, along with the GL accounts associated with them and the functionality that they have in the system. Note that several of the sample payment types are associated with Cash GL accounts. Most organizations have multiple cash accounts in their general ledger. Each cash account reflects a different existing bank account. Organizations have different accounts for various reasons, and it is common to have a separate account for credit card payments. After the organization's GL accounts are created in Aptify, payment types can be updated to indicate where cash normally flows for that payment type. See Processing Payments for information on Payments.

Sample Payment Type

Associated GL Accounts

Functionality

Purchase Order

None

A purchase order is a promise to pay; it is not itself a payment. Therefore, customers who use a purchase order as a payment type must later provide another type of payment to cover the purchase. Because the Purchase Order payment type is not designated as an "Inflow" type, it cannot be used to create a Payments record. Saving an order with a Purchase Order payment type does not create a related Payments record. A Due Date is saved with each purchase order to indicate when payment is due from the customer.
If required by the system, an order's Bill To party must have an Approved credit status and a credit limit that covers the amount of the purchase order transaction.

Cash

Cash

When an organization receives payment from a customer in the form of cash, the sample Cash payment type handles the payment in a Cash account. The organization may choose to tie the Cash payment type to whichever GL account is appropriate for their business practice.

Pre-Paid Check

Cash

When an organization receives payment from a customer in the form of a pre-paid check, the sample Pre-Paid Check payment type handles the payment in a Cash account. The organization may choose to tie the Pre-Paid Check payment type to whichever GL account is appropriate for their business practice.

ACH Wire Transfer

Cash

This payment corresponds to an electronic funds transfer, like a debit card purchase or automatic withdrawal from a checking account. When an organization receives payment from a customer in the form of an ACH transfer, the sample ACH payment type handles the payment in a Cash account. The organization may choose to tie the ACH payment type to whichever GL account is appropriate for their business practice.

Visa, Mastercard, American Express, and Discover

Cash

All default credit card payment types are set up the same way in the Aptify sample data. When an organization receives payment from a customer in the form of a credit card, the sample payment type for each credit card handles the payment in a Cash account. The organization may choose to tie the payment type for each credit card to whichever GL account is appropriate for their business practice.

Companies may set up separate bank accounts to handle credit card payments. Each bank account is reflected in a separate "Cash" GL account in Aptify. After the organization's GL accounts are created in Aptify, payment types can be updated to indicate where cash normally flows for that payment type.

Credit Memo

Cash

A Credit Memo is an order with a negative balance. Credit memos are created when a customer returns a product or provides an overpayment. The customer can request a refund or ask to leave the balance on account. Balances left on account are used later in the form of Credit Memos to pay for other goods or services.
The organization may choose to tie the Credit Memo payment type to whichever GL account is appropriate for their business practice.

Refund Voucher

Refund Payable

When a customer returns a product that has already been paid for, the organization refunds the money through a Refund Voucher using a Refund Payable GL account. This account is a contra-revenue account that appears in the income statement as a deduction from gross sales -revenue.

Bad Debit Write-Off

Bad Debt

When a customer fails to make payment for an order that was placed on credit, the bad debt must be recorded. The Bad Debt GL account recognizes uncollected receivables in which no expense is recognized until individual accounts are determined to be worthless. At that point the account receivable is written off with an offsetting debit to uncollected accounts expense.

NSF Check

Cash

This payment type applies to "bounced" checks that are returned by the bank due to insufficient funds in the customer's account. When a check is returned, an organization creates a payment adjustment to reverse the original payment. See Processing a Non Sufficient Funds Check for details.

CC Reference Transaction

Cash

Aptify supports credit card processing using PayPal reference transactions. Using this approach, an organization can simplify PCI compliance because Aptify does not store credit card numbers in the database. During an initial transaction, Aptify transmits the credit card number to PayPal and receives a PayPal reference transaction number in return. If using reference transactions, you must create one or more Payment Types using the Credit Card Reference Transaction base type. Aptify does not include a sample of this payment type be default.

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