To take individual attendance, you must first open the data event. When the event is open, scheduled students default to present in the present/absent boxes above the student notes area. To mark a student absent, focus to that student and click the absent button. Next, indicate the reason for absence using the drop down options or choose 'other' for a customized reason. This information will then appear on the student's attendance report.
You can also mark all students in a group absent for things like a fire drill or holiday - that is done in the agenda view on the daily data screen using the 'Actions' button next to the group.