Adjustments without paying money

I am providing a service (Sales) for a customer. There are some arreras invoice to be paid by the customer (X)

The same customer is providing consulting service (Purchase ) through my limited company for my client.

I have raised invoice to the client and the payment is received. They are tagged now.

I owe Y amount to be paid for the work done at client place. The customer is happy for me to adjust the arrears (X) and pay the rest. How do i adjust this in Quickfile?

You can open another dummy bank account and call it contra account, simple record transaction which cancel out with each other using this contra account and actual payments through your main bank

Thanks. Would i then make the outstand invoices as paid?

yes otherwise it will show up in your debtors/creditors