Unbelievable late charges against paid invoices

We are on R12

Scenario:

$1000 Invoice transaction date Feb 1st 2012

$1000 Receipt applied to $1000 invoice date Feb 2nd 2012

$100 Credit applied to $1000 invoice date May 1st 2012

Late charges run May 31st 2012.  

Late charge invoice was automatically created based on $100 from the $1000 invoice, as if $100 of the $1000 transaction was overdue. 

Any idea how or why it would do this? I searched metalink and this community to no avail.

Regards,

-John