Categories don't appear in drop down list in transaction register (Q Mac)

TPB_

I have a category that is clearly present in the category list (Bills & Utilities:Internet), but it is NOT an option in the transaction register. Even when i select "create new category…" and the enter the transaction, the category reverts to "Uncategorized"? The image below has the category list on the left and you can see the desired category (Bills & Utilities:Internet) is there, it's just not available in the transaction register. Interestingly, I CAN run a category report that shows plenty of transactions in the "Bills & Utilities:Internet" category - I just can't use it for any NEW transactions. Thanks!