In A2X for Shopify, the Sezzle payouts are generated as per the data fetched from Shopify. The expected deposit amount that A2X allocates to the clearing account per Sezzle payout is the gross amount - so the Sezzle fees are not deducted. Why? Simply because the Sezzle fees don't pass through your Shopify account, which is what A2X is connected to.
This guide will explain how to confirm that the A2X payouts balance back to your monthly Sezzle detailed statement, as well as how to allocate your Sezzle fees monthly.
1/ In A2X - sort your payouts list by a payment gateway
For reasons of clarity, we have listed below the A2X Sezzle payouts covering the two months (Nov, Dec) that we will cover in this article:
Please Note: The account in our example is set up to generate Sezzle payouts daily. However, you can also set A2X to generate either weekly or even better, monthly payout entries for your other payment processors such as PayPal, AfterPay, Sezzle, Stripe etc.
2/ In Sezzle - download a monthly report of account activity for a given period
We requested both the November and December reports as shown below and excluded/greyed out the unnecessary text detail for simplicity purposes.
From the Sezzle report, review both the Payouts tab and the Refunds Tab to obtain the information needed:
3/ Compare and balance the A2X payout amounts to the Sezzle Statement data
This is the flow of events:
Throughout the month, A2X is posting the Sezzle payout total or 'expected deposit amount' to the Gateway Clearing account.
Throughout the month your Sezzle deposits are received into your bank account, net of fees. These deposits are allocated to the Gateway Clearing account to offset the balance entered by A2X.
At the end of each month, the difference in your Gateway Clearing account will generally be the Sezzle fees. The fees need to be accounted for by completing a journal entry deducting the monthly fee total from the Gateway Clearing account, allocating to your Sezzle fees expense account.
Please Note: On the odd occasion, the difference in the Gateway Clearing account may also be caused by a carry-over balance for a transaction that hasn't cleared yet.
If we put the above flow of events into numbers:
A2X has allocated an amount of $4,509.96 to the Gateway Clearing account for November and December 2019.
We have allocated all Sezzle deposits throughout the two months to the Gateway Clearing account - the total of the Sezzle deposits for November and December 2019 is $4,204.38.
This leaves a balance in the Gateway Clearing account of $305.58 - which is the total of the Sezzle fees for November and December 2019. Separated by month, the Sezzle fees are $110.45 for November 2019 and $195.13 for December 2019.
4/ Account for the Sezzle fees using a manual journal entry
In QuickBooks Online, the monthly entry for the November 2019 Sezzle fees would look similar to this:
In Xero, the monthly entry for the November 2019 Sezzle fees would look similar to this:
The result is that the Gateway Clearing account is reconciled back to $0.00.
As mentioned above, on the odd occasion there may be a balance that will carry forward into the next month due to timing.
If you need more information on how PayPal payouts work in A2X and Xero, you can watch this video tutorial or if you have any other questions, please reach out to our support team anytime.
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