Hey @Debra300
Apologies for the delay - I've been looking into this but as far as I am aware if the cancellation is agreed ahead of the check-in (with reasonable time), then the payment to the host won't be sent, and therefore no deduction will be made.
However, if the cancellation and refund is agreed during the stay or just before the check-in time and the host receives the payment then this could be claimed back from a future booking.
If the host never got the payment for the original booking and was then deducted the funds from another booking as well, then that shouldn't happen and it is best to contact our Community Support team to get them to look into the specifics.
For reference, if you scroll to the 'for Hosts' section of this article, it does detail the process for what happens when a guest cancels and requests a full refund. It does have a similar timeframe to the one you mentioned above, so I'm wondering if perhaps this is where there may be confusion. This article also details the guest-initiated cancellation from the host perspective.
To be honest, there are a lot of factors that could be at play here, so it depends on the individual circumstances for each cancellation really.
I hope this helps to clarify a little 😊