Hi Ajackdan,
Welcome to the Support Communities!
This article will explain how payments are processed:
iTunes Store: How iTunes Store purchases are billed
http://support.apple.com/kb/HT5582
Order of iTunes billing methods
When making purchases, content credits are used first, followed by Gift Certificate, iTunes Card, or Allowance Account credits; your credit card or PayPal account is then charged for any remaining balance.
Cheers,
Judy