QB Issue Resolution:

You have to create an invoice to offset the credit & then use the receive payment screen to apply the credit to the invoice.

Resolution for Issue 'How to zero out a credit memo' available: Yes (Solved).
Source: Intuit Community forum.

How to zero out a credit memo: this issue or error code is a known issue in Quickbooks Online (QBO) and/or Quickbooks. Support for this issue is available either by self-service or paid support options. Experts are available to resolve your Quickbooks issue to ensure minimal downtime and continue running your business. First try to resolve the issue yourself by looking for a resolution described below. If it is a complex issue or you are unable to solve the issue, you may contact us by clicking here or by using other support options.

Support for Credit Memo
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Error Recovery for Credit Memo [Canada]
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