Transaction type is already on an outstanding payment

If you get a message popping up about the invoice that you are trying to allocate is already being allocated to an open payment, to troubleshoot this follow the steps below:

From the Navigation panel

Open up Relationships

Open up Customer Transactions

click on Customer Payments

Add on column Status

Filter out the results to show only Open status transactions

As you click on the open customer payments, on the right hand side is the detail area that shows you the invoice/s it is trying to allocate against.

Either delete the payment and start again or finalize the payment and allocation.