Whenever a payment is posted it is recorded in the Payment Register. The recorded receipt of the payment provides credit to their account to offset charges. However, this payment is also distributed to the Subledger to offset the corresponding Sub-Account charges that resulted. These distributions are called Payment Credits and are a special type of a credit transaction.
For example; An individual makes a Payment of $100 to their account.
First, the Payment is recorded in the Payment Register for that individual and their account is credited $100. Next SchoolLeader looks at the Subledger to determine what charges are currently outstanding for that individual which can be offset by these payments. Lets say that the original $100 in charges accumulated as follows:
$60 to Tuition
$30 to Enrollment Fees
SchoolLeader will therefore apply Payment Credits to the subledger in those same Service Accounts for the amount indicated.
If the payment exceeded the amount owed (e.g. $120) then SchoolLeader would post the excess to the "Prepayment Account" to be used when charges exist.
If the payment was less than the amount owed, it would cover the charges it could and leave the remainder outstanding. The balances are covered using a priority factor defined in the Chart of Accounts.