The a/c was on and the we smelt dust burning like the heat came on, now it seems not to be cooling properly. Will blow cool air but not cold, had someone check frion and that's OK.

Is it electric furnace,? Its possible both the ac and furnace are running at the same time,, tell us what kind of equipment +model number you have

Yes it is electric, I think it is a Nordyne E2

Yes it is electric, It's the freon. At some point, there is just not enough left to transfer the heat. You need to recharge it.air conditioner (http://www.houstonairconditioners.net/air_conditioning_replacements.html)

The a/c was on and the we smelt dust burning like the heat came on, now it seems not to be cooling properly. Will blow cool air but not cold, had someone check frion and thats ok.

The electric heater (s) are running at the same time the A/C is running. It could be.

Miswired thermostat
Shorted low voltage wiring
Stuck or damager heat sequencer.