Click on the appointment which you would like to cancel. A window will open on the right hand side as below. Click on the ellipsis and select "Cancel booking" from the drop down menu:
A pop-up will appear, click on the arrow as circled below:
A drop down menu will appear:
Once you've selected your "Cancellation reason", click confirm as circled below:
The appointment will disappear from your calendar:
If you would like to view all the bookings that have been cancelled together with their cancellation reason click "Analytics" and scroll down to reports and the "Booking report" as below:
Once you click "Generate report" then you will see the "Cancellation reason" column in your report as circled below: