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I believe in MEP12 there is a icon of sissors on the bar above the timeline, between the timeline and media pool. Use that to cut clips. You can place the red scrubber bar on the location of the clip and select the sissors. They changed it in MEP14+, now there is a razor blade under the viewer.
Just cut a section and hit Delete on the keyboard, that will cut it.
Man…I’ve been using MEP14+ so long now I have forgotten the buttons in 12. LOL