For Invoices:
Where a Returns OUT (Early Payment Discount) is accepted and paid, the entries into your accounts are as follows. Please note that steps 1 & 2 are fully automated.
Using an example of a 2 Invoices, totalling $3,555.00, with $250 Returns Out acceptance (Early Payment Discount) = $3,305 Net Payment.
Invoice 1 - $1,555.00 less $100 discount = $1,455.00
Invoice 2 - $2,000.00 less $150 discount = $1,850.00
Total credited to your bank account = $3,555.00 less $200 = $3,305.00 (this is the amount you will see on your bank statement)
Upon Invoice payment: (Part 1- 2 are automated by Parakeet)
Part 1:
Invoice 1
$1,555 is posted against your Invoice (1) and marked as paid
$1,555 is posted against your Parakeet AR Clearing (Interim) account; and
- $100 is recorded as a 'Spend Transaction' in Xero against Parakeet AR Clearing (Interim) account; and
- $100 is posted to your Parakeet Returns Expense account
Bill 2
$2,000 is posted against your Invoice (2) and marked as paid
$2,000 is posted against your Parakeet AR Clearing (Interim) account
- $150 is recorded as a 'Spend Transaction' in Xero against Parakeet AR Clearing (Interim) account;
- $150 is posted to your Parakeet Returns Expense account
Part 2:
$3,305 transfer now automatically occurs from Parakeet AR Interim Clearing Account to the Parakeet AR Clearing FINAL Account
Parakeet AR INTERIM account is now cleared to $0.00
$3,305 now sits in your Parakeet AR Final Clearing account
Part 3: (One Click Transfer)
You will now transfer the $3,305 from Parakeet AR Final Clearing Account to match the $3,305 Receive entry your bank statements.
You can see it HERE - Refer to the 3:13 minute mark of the demonstration video below