From the Credit Memo
  1. In Records, Credit Memos, open the credit memo.
  2. On the Credit memo tab, select Show all unpaid invoices from the drop-down menu.
  3. The invoice will populate and the Apply and Auto Apply buttons will become available.

From the Invoice:

  1. In Records, click Invoices
  2. Open the Invoice
  3. On the Payments/Credits tab, unapplied Credit memos are shown at the bottom of the screen
    Note: If no Credit Memos are showing, select Show all Credit Memos from the drop-down menu
  4. To automatically apply the credit memo (starting with the oldest balance first), click Auto Apply.  To apply the invoice to a specific credit memo, highlight the invoice and click Apply, entering an amount, if applicable