How it runs for e-commerce brands and Amazon sellers
Your accountant works both daily in QuickBooks Online or Xero, clears unapplied cash weekly through our ReconBot routine and keeps the receivable by retailer and the balance owed by each marketplace accurate for follow-up and forecasting.
What is cash application?
Cash application means matching money received from customers to the invoices it pays and recording that in the accounting system. It covers bank receipts, checks, lockbox files, card payouts and remittance advices, including partial payments, deductions and payments with no reference. Done well, the aging is accurate and no customer is chased for an invoice they already paid.
What we handle for e-commerce brands and Amazon sellers
- Settlements applied to the summarized sales journals they settle
- Marketplace reserves, holds and loan deductions recorded as separate lines
- Retailer remittances applied invoice by invoice with deductions coded
- Short payments flagged for dispute within the retailer's window
- Unapplied cash cleared weekly with the reason logged
The KPI that matters here
Unapplied cash older than 5 business days held at zero, measured every week.
E-commerce compliance notes
Marketplace facilitator laws
Every US state with a sales tax now requires marketplaces such as Amazon, Walmart, eBay and Etsy to collect and remit sales tax on third-party sales. The marketplace's collections appear in your settlement reports and must be recorded as tax collected and remitted by the facilitator, not as your liability. Some states still require registered sellers to file returns that report marketplace sales as exempt.
Sales-tax nexus on direct sales
Direct sales through Shopify, your own site or wholesale count toward each state's economic nexus threshold, commonly $100,000 in sales or 200 transactions in the current or prior year, and inventory stored in FBA warehouses can create physical nexus. We track sales by state monthly, flag thresholds approaching and prepare the workings for TaxJar, Avalara or your filing provider. Registration and filing decisions rest with you and your tax adviser.
VAT, GST and cross-border selling
Selling into the UK requires VAT registration once taxable turnover passes £90,000, or from the first sale for many overseas sellers, and EU distance sales can be reported through the One Stop Shop. Canadian GST/HST and Australian GST apply to imported low-value goods and to registered sellers. We prepare VAT and GST workings for your accountant or registered agent to file; we do not submit returns.
Inventory valuation and 1099-K reporting
Inventory must be valued consistently, including freight, duties and prep, so COGS and taxable income are right. Payment processors and marketplaces issue Form 1099-K for gross payments, which is reconciled to recorded sales so the figures your CPA reports agree with what the IRS receives. Tax preparation is support only; your firm reviews and signs.
E-commerce software we work in
More for e-commerce brands and Amazon sellers
Other services for e-commerce
Frequently asked questions
How do you apply a retailer remittance with many deductions?
The remittance advice is matched to the invoices it lists, and each deduction is recorded against its invoice with the retailer's reason code. Valid deductions clear the balance; questionable ones stay open as short payments with supporting documents assembled for a dispute. The result is a receivable that shows exactly what is still collectible from each retailer.
How is an Amazon reserve release applied?
When a settlement includes a release of a previous reserve, the accountant applies it against the marketplace receivable recorded when the reserve was withheld, rather than treating it as new sales. New reserves in the same settlement are recorded as a receivable. The marketplace balance in the ledger then matches the balance shown in Seller Central.
Can you apply cash inside a wholesale platform such as Faire or a B2B portal?
Yes, where orders and payments run through Faire, Vendor Central or a retailer portal, the payout report is used to apply cash to the orders it covers, with platform fees and net terms financing charges posted separately. The ledger receivable is reconciled to the portal's open balance monthly so both agree.
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