Methods for Making Payments

When making payments, your payment method will consist of the following options:

1. Cash Accounts
2. Bank Accounts
3. Bank Overdrafts
4. Credit Cards
5. Checkbooks
6. Employee Private Funds. Click here for more details

Entering Purchases

Payment methods are only used when you enter a cash expense (i.e a purchase that was paid for immediately. For supplier invoices, payment terms or a specific due date is used. This is because the payment will be entered later, after you have paid.

Selecting a Payment Method

When making payments, the payment method is often labelled Paid From (i.e. the label for the payment method selection box).

Cash Payments

If you pay by cash, the cash account that the money came from should be selected (i.e. an office cash box or a cash register).

Bank Payments

If you pay a supplier by a bank transfer or a direct debit from one of your bank accounts, this bank account should be selected as the payment method.

Paying by Cheque

If you write a cheque to pay for an expense, select the relevant cheque book as the payment method. When a cheque is written, the amount is treated as a liability (debt) until the supplier cashes the cheque.

When you record a cheque as cashed, the associated bank account will be reduced by that cheque's amount. Therefore, it is important to ensure that the correct cheque book is selected.

Read more about using cheques here.

Using a Credit Card

If you use a credit card to pay, select the credit card you used as the payment method. When a credit card is used, the amount is treated as a liability (debt) on the credit card, until you reconcile your credit card account (i.e. match your credit card transactions with the statement received from the credit card issuer).

Read more about using credit cards here.

Using Debit Cards

A debit card is directly associated with a bank account, therefore that bank account should be selected as the payment method whenever a debit card is used. There is no need to record it as debit card payment, as the money is directly debited from the associated bank account.