http://www.fatwa-online.com/good-deeds-wipe-away-sins/
Reference: Fataawa Noor ‘alad-Darb – Question No.6259, Page 96, Volume 12
Question: How do good deeds wipe away sins? Is it [as simple as] the sins just go away and the [reward for] good deeds remain?
Response: Yes, this is how Allaah (‘Azza wa Jall) said [so]:
*{Indeed, good deeds do away with misdeeds}*, soorah Hood, aayah 114
So based upon this, if a person does a good deed after he has committed a sin, then [in shaa.-Allaah] it will be [a cause for it being] wiped out, particularly if the good deed is [the act of] repentance from [having fallen into] that sin. Indeed, [sincere] repentance wipes out that which has passed [from sins]; [in this reagrd], Allaah (Tabaaraka wa Ta’aala) said:
*{Say, “O My servants who have transgressed against themselves [by sinning], do not despair of the mercy of Allaah . Indeed, Allaah forgives all sins. Indeed, it is He who is the Forgiving, the Merciful.”}*, soorah az-Zumar, aayah 53