1. Select AP, Invoices, Invoices, Enter.
2. Select the vendor and enter a new invoice #. For example, if the original invoice was 123 enter 123-1.
3. Enter the Date, Amount, and Terms for the invoice.
4. For the distribution, select the original cash account used for the cash payment.
5. Go to C/M, Transactions, Enter Bank Transactions.
6. Enter a Credit for the amount of the cash payment and deselect Post to G/L. See How to enter bank transactions.
7. In the CM, Transactions, Reconcile Checking Account, clear the original cash payment and the credit together.

 NOTE: If this is a 1099 vendor, you need to adjust the 1099 amounts at the end of the year to reflect the adjustment. 

 TIP: For future transactions, post the cash payment using the type EFT. You can void EFT payments.