To add or remove a product from the category:

From the product page,

• In the “categories” panel, click on the change categories link.

• To remove a category, click the “x” button next to the category name.

• To add a category, click in the blank space under “Select Categories”, and begin to type the name of the category. A list of categories will appear. Click on the desired category.

• Once you are satisfied with the category list, click the Update button. 

Sort Order of Products within a Category

To manage the sort order,

• Go to the category (Choose Catalog, Categories).
• Choose "Manage Category Items"

• Drag and drop to change the sort order
• Choose "Save Sort Order"