Inventory blocked transactions not taken into account in weighted average

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Posted on by TMeersschaert

Hi,

We identified that when inventory is blocked during an inventory close that the value of the blocked inventory quantity is not taken into account for determing the weighted average.

Example:

Purchased goods 500 pieces at €15 per piece.
Purchased goods 1000 pieces at €10 per piece.
- 200 pieces are not blocked
- 800 pieces are blocked by an inventory blocked transaction (for example: quality order). This inventory transaction is marked with the inventory blocked inventory transaction (= standard D365).

Currently the system calculates the weighted average as follows: ((500*15) + (200*10)) / 700 = €13,57. Because the 800 pieces are directly marked with the inventory blocked inventory transaction these are not taken into account.

Our customer expects the average to take into account all the received goods: ((500*15) + (1000*10)) / 1500 = €11,67. Is there a way to get this configured?

Here's another example. This might make it more complex, the general question is: how to take into account blocked inventory during weighted average inventory closing calculation?

Weighted average ...

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André Arnaud de Cal... 301,496 Super User 2025 Season 2 on at

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Hi TMeersschaert,

There is no configuration for this. I wonder if this is as per design or not. Anyway, once the quality order is completed, the closing will take the items into account. If you want to be sure about the intended functionality, you can create a ticket for Microsoft Support.

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TMeersschaert 19 on at

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Hi André,

According to my analysis the wrong weighted average cost price has impact on the future weighted average prices. See document in attachment in my first post.

I logged this to Microsoft.

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André Arnaud de Cal... 301,496 Super User 2025 Season 2 on at

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Thanks. I now fully read the document you attached. I see your point. It is good that you created an incident. Would you mind updating this post once you have some updates from Microsoft Support?

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TMeersschaert 19 on at

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After quite some time I got definitive feedback from the product team and they emphasize that this weighted average calculation works as designed. The blocked inventory is not considered as being on stock until the block is released.

After some further reading I came to the conclusion that this problem would not occur when we value with the "moving average" costing method. So I guess that is the solution for our problem. Further test with the moving average principle is needed.

See also: Is there a difference between the Weighted Average and the Moving Average?

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