Under Order Settings, select Yes if you want to record payment transactions in Xero. All the payments that are recorded in Xero will automatically be matched against the corresponding sales order and are marked as PAID. Xero does not let the paid invoices be reconciled with bank payments and some users may choose not to sync payments if they are reconciling the invoices with bank payouts manually. All the payments including partial payments will be recorded and mapped against the appropriate sales order in Xero.
If you select No, then all the invoices with UNPAID status will have to be marked as PAID manually.