If a customer has not paid for the items sold then it easiest to follow these two steps:
1. Create a Credit Memo for the unpaid balance of the billing - The process to create a credit memo is almost the same as creating a manual billing. The main difference is that when the billing lines are entered, they are entered with negative values. This will automatically change the type from invoice to credit memo. The transactions created when posting a credit memo are a debit to the GL account that is populated in the Revenue Account selected on the billing line, and a credit to the AR Control Account. 
Tip - To associate the credit memo with an original billing, place "Credit Memo for Billing number xxxxxxxxxx" in the Proprietary Billing Number field.
2. Apply the credit memo to the billing by clicking on the Apply Credit Memo button.
3. Create an inbound inventory movement with a type of Accounting. Set the Credit GL account to the value used to record Cost of Goods Sold. This will increase the quantity available for that product and take it out of Cost of Goods Sold and put it back into Inventory. 


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