Sounds line you either did not apply the payment as you thought or the payment application batch has not been released or suspended.
Start a new payment application batch for $0.00 and select the customer in question and press F3 on the number field below the type field and see if the reference number of the payment is showing. If so, select it and apply it to the invoice shown in the detail section and release the batch.
If the payment is not showing after pressing F3, it is possible that the original payment application batch is not released or suspended. To check if it was suspended, open the Release AR Batches menu item and see if it shows any batches in the grid with an S status. If so, you need to determine the reason for the batch being suspended. If there are no suspended batches, the payment might have been selected for application in another batch that has not been released. You can look for such a batch by either opening the payment application screen pressing F3 on the batch number field and scroll through the list looking for a batch that is either on hold, or balanced (un-posted is not a problem).
If none of this reveals anything, respond back and we can go over some other things to look at.