Transaction screenshot

The Transactions tab is filtered by date and warehouse.  Make sure you are looking at all the data.

On the Quantity tab, is the 10 still on hand?  If yes, the SO invoice line could have been marked as "Drop Ship", which doesn't affect inventory.

If you received in 10 and sold 10 the quantity on hand would not change as the two transactions cancel each other out. But if the sales order was Drop Ship you see no sales.

The drop ship check box was checked off on the SO detail.

Drop Ship Items do not 'impact' inventory.  If the SO Line was a Drop Ship (DS Flag On); then your PO should have been a Drop Ship so the vendor sent the goods directly to the customer. 

Do you mean checked "on"?  That means the SO invoice posting would not deplete inventory.

I think the DS check box was checked "on" Kevin M after the PO was created either by accounting or the user by accident.

That explains it then. 

Either do a credit (duplicating the invoice settings exactly) then re-invoice correctly, or do an inventory issue against the correct COGS account.