It not automatic please
First the terms you have should be clearly stated on the invoice. Anytime a customer comes to pay money they you will have to come with the details (Invoice # and the date the invoice was issued) to help you trace the transaction in your system and determine if Cash Discount applies.
Create an expense account, you may call Cash Discount. Upon receipt of cash from Customer, add the Cash discount account line and enter a negative number to effect the discount. You do not need to update your sales invoice. Cash discounts don’t call for the updating of sales invoices, the discount transaction should be effected only in the receiving of money or on the receipt. From the example below, the customer was to pay 5000 but will now pay 4000 due to the discount line item.
(In my system i have created cash discount as an item, that why you see it under items too, but the same applies if you use an expense account simply for it)
Manager will take care of the double entry involved.
Cash discounts unlike trade discounts must be shown on your income statement. The discount tool in manager is a trade discount , so it doesn’t show the discount double entry.
I didn’t go deep into the process of setting up the discount account and all because i assume you can easily set it up and start applying it yourself. I also am assuming you are good with accounting. But if you need me to break it down, I would