A check to a customer either is a refund directly from an income/expense account entry on the Expense tab or an Item listed on the Items tab. For AR refunds, you issue the refund from the Payment screen where you have an overpaid condition; or, from the Credit Memo, at the top, the icon to Refund this creates a Check that lists AR on the expenses tab.
If you issued the AR check manually, and you have a credit memo, you link them using Receive Payment but leave the amount here as 0.
