Wow!  I just got off the phone with Customer Service at Square.   Yes, they have changed how Varible Priced items work in Invoicing. I must have missed that announcement.  So when you get to the item field, you must type the letter c.  Then select Use Custom Item "c"  which will have a light blue background around it. Then type over the c in the same field the item or a keyword to bring up a list of items (normal method).  Then select the item you are looking for and then you will be able to enter a price and quantity.

I passed on my thoughts that the system worked fine and was intuitive and was simple. Now, it is not intuitive and requires a lot of extra key strokes. The tech agreed.  In my opnion, the programmers had some type of bug and they inserted a work-a-round instead of fixing the problem.

Good Luck using this system!

OK, I got more info from Square Support.  Obviously the use of the "c" entry (advise from phone support) is a workaround for some type of problem they are having.

Another response came in by email and offers a different approach:

"We are currently experiencing some issues with our invoicing product, but our engineers are working on it. In the meantime, to add a variably priced item to your Invoice you will need to create a NEW variably priced item in your Item Library. Once you do this, add the item to your invoice. You will then click the grey carrot to the right of the item line and click 'Customize' in blue text. From there you are able to enter the custom price as well as edit tax if needed."

A quick work around is to go to the items page and look at the items price. If the price is $0 but the font is black, click on the price and remove it. It should now say $0, but in a grey font, as if there is no price, instead of actually having a price that is zero dollars. When you save the item, variable price invoices should now work correctly.