Updated for 7.0
Click on the Settings icon (the gear) located to the right of the search bar. This will take you to this page:
Within the horizontal navigation bar select Accounting. Then select Invoice Types. This will take you to this page:
To add an invoice type, click the yellow + Add button in the bottom right-hand corner.
Click on the box that says name and type in the name of the new invoice type.
When done, click the Update button in the bottom right-hand corner to save changes.