How to handle Credit Card Refund

Client has presented an issue that I am not clear on how to handle.

1. Customer is invoiced for 1,000

2. Customer uses Credit Card to pay 1,000

There upon the customer balance is ZERO

Two months later the customer complains about the time and the company determines that they made an error and the Customer is entitled to a 100 refund.

Question

1. What document do you use to record the REFUND

2. Do you record the REFUND in the CUSTOMER record

How does this change if the INVOICE were for 2,000 and the initial payment were for only 1,000.  

How do you deal with the refund to the Credit Card

The bottomline is that we are not allowing the RETURN or the REFUND to sit in an account - the monies are being returned to the CUSTOMER via a Credit Card transaction.