Let's use the following example. Say you have a calendar year membership order that goes from January 1, 2013 to December 31, 2013, and the customer calls to cancel on October 22, 2013.
If your organization's policy is to refund the membership for the remainder of the year (i.e., the rest of October, November, and December), the recommended way to refund the membership for the remainder of the year is to perform the following:
1. Right-click and select Show Full Line Item Details.
2. From the Line Item Details screen, change the Fulfill Status to "Terminate at End" (i.e., don't renew).
3. Click the Product Specifics tab.
4. Change the End Date to the date in which the customer no longer wants membership (e.g., October 22, 2013).
This way the membership order will still be active but only through October 22, 2013 and Line Status is Active. Therefore, if you run member counts, this customer will be included as a member for January 1 through October 22. You also have the revenue for that period and you'll notice that the amount on the order has been prorated. Since there is a credit balance on the order, you could then do a refund to refund the prorated credit balance to the customer.