Q: How do I reverse a payment due to incorrect posting or because a check was returned NSF?
A: Go to >Transactions >Apply Payments and record a negative payment to unapplied cash. You can put the invoice number in place of the check number. Be sure to give the unapplied cash a description referencing the invoice paid. This negative unapplied cash payment will reverse the journal entry recorded as a result of the original payment and make the amount available for repayment by the customer.