The following blog post is to provide guidance for users of the Inventory costing functionality within Microsoft Dynamics NAV. The specific article is designed for providing guidance that you are able to use Appl. – from Item Entry to create an Item Entry Application across locations. This feature is not permitted using the Appl. – To Item Entry when you try to make an Quantity Item Entry Application across Locations.
Appl. – from Item Entry is intended when you want to make an Item Fixed Cost Application overwriting the default Costing Method. It means that the inventory increase, for example a sales credit memo line is linked to the inventory decrease in the item ledger entry that you indicate in this field.
Initial scenario to illustrate
This scenario is carried out in W1 Cronus.
1. Create new item 70061, Unit of Measure PCS, any posting groups and select costing method FIFO.
2. Create Purchase Order against vendor 60000, Item 70061 Location BLUE, Quantity 1, Direct Unit Cost Excl. VAT 10. Specify vendor invoice number and posted as Received + Invoiced.
3. Sell item 70061 using Sales Order against customer 60000, Location BLUE, Quantity 1. Post as Shipped + Invoiced.
4. Create Sales Credit Memo against customer 60000, using Get Posted Document Lines to Reverse to retrieve the Posted Sales Order processed at step 3.
Notice: Appl. – From Item Entry is populated.
5. Change location from default BLUE to RED.
Notice: Appl. – From Item Entry has not been changed.
Notice: Return Reason Code field on the Sales Credit Memo line will enable to set a Default Location Code.
6. Post the Sales Credit Memo as Invoiced.
7. Purchase Order for Item Charge Freight against vendor 61000, Location BLUE, Quantity 1, Direct Unit cost Excl. VAT 2.50.
8. Assign the Item Charge against the Purchase Order that been processed at step 2. Specify vendor invoice number and posted as Invoiced.
9. Run Adjust Cost Item Entries batch job. Lookup Item Ledger Entries and notice 2.50 been forwarded from Sales Order to the Sales Credit Memo we processed at step 4.
By applying a positive entry in this case Sales Credit Memo to a negative through Appl. -From Item Entry, we make a cost application between them and hence turn this positive into a “Return / Correction”, that has to receive its cost from the applied outbound. Since the positive entry is now effectively a “return”, the entry application is allowed across locations. This is essentially a feature of the Returns Order Management that was introduced since 3.01. In recognition of the fact that
customers may want to return products to a location different from the one where they originally sold.
1. Create new item 70062, Unit of Measure PCS, any posting groups and select costing method FIFO.
2. Open Item Journal, Entry type Negative Adjustment, item 70062, Location BLUE, Unit Cost 10, Quantity 1. Post.
3. Open Item Journal, Entry type Positive Adjustment, item 70062, Location RED, specify Appl.-From Item Entry against Negative Adjustment.
Notice: When you drill down into Appl. – From Entry, there are no Item Ledger Entries. You need to remove the (location) filter and then you can select the Negative Adjustment.
Notice: Lookup item ledger entries of item 70062 and both item ledger entries are left open. This is intended design.
4. Post the Positive Adjustment created at step 3.
5. Open Item Journal, Entry type Positive Adjustment, item 70062, Location BLUE, Unit Cost 13, Quantity 1, Post.
6. Run Adjust Cost Item Entries batch job.
Notice: Outbound (step 2) and Inbound (step 4) are now closed on the Item ledger entries.
7. Adjustment of LCY 3 is now forwarded according to the chain: Positive Adjmt., step 5 -> Negative Adjmt., step 2 -> Positive Adjmt., step 3.
So, the Item Entry Application is possible between locations when and only when we have a Cost Application between the outbound and inbound entries.
The same logic cannot be applied to Transfer Orders as they generate a quantity application between entries. One reason you cannot create Transfer Order when you do not have the Quantity on Hand.
Product Support Escalation Engineer
APGC Customer Support & Services SMS&P