It sounds liike your preference to 'Automatically Calculate Payments' has been turned off, which is causing the flow situation you're seeing.  You could go to QuickBooks > Preferences > Sales & Invoicing and then turn on the pref. to Automatically calculate payments.  Then when you go to receive payments and check mark the box to Apply Existing Credits it will auto assign to the oldest invoice first.  

If you would rather assign the credits yourself, you can leave the setup you already have.  But when you are on the Receive Payments window and click the checkmark to Apply Existing Credits, instead of checking off the invoice you want to apply it go, go to the Payment column of the invoice you want to apply the credit and type in the amount you want to apply.  After doing that, once you tab or click to another field it will associate the credit to the invoice and you can save the changes.

Hope this helps out.