AP Payments Issue

A check was paid against an invoice, and then voided, yet the check went out and was cashed.

Example:
1. Invoice created for 1000
2. Invoice paid for 1000
3. Payment was voided.
4. Check was sent to the supplier who cashed it.
5. Invoice was also canceled and another check against it was voided.

Solution Summary:
Create a 0 amount invoice with 2 distribution lines, 1 for the expense account as a debit and the other distribution lines to the cash account as a credit

Solution Explanation:
When the invoice was created if this was just a simple invoice created, invoice paid, payment voided, but check cleared, then the following has to be done:

Original invoice
Expense A/c--------Dr 1000
Liability A/c--------Cr 1000

Payment
Liability A/c--------Dr 1000
Cash A/c----------Cr 1000

Void payment
Cash A/c-----------Dr 1000
Liability A/c-------Cr 1000

But to take care of the voided check that cleared and was cashed, create a 0$ invoice with two new distribution lines:

Line 1 with 1000
Expense A/c--------Dr 1000
and
line 2 with -1000 (you fill in the expense account as the cash account)
Cash A/c------Cr 1000 (this is used in place of the expense account)

Here the amount for Liability A/c will be 0 once the invoice gets created.

So invoice is still owed, and we issue a 0 amount manual payment check
Liability A/c--------Dr 0
Cash A/c----------Cr 0