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Small and medium business | Business Central, N...
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Purchase Order with multiple items assigned to different Locations ?

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Posted on by 26

Hi everyone,

I’m working on Business Central Online v27 and I have a question regarding Purchase Order structure.

In a purchase document, I have two different lines, and each line uses a different Location Code (Location A and Location B). Since BC allows line-level location selection, the document posts correctly.

My question is:

What is the recommended practice for the Location Code on the Purchase Header when the lines use different locations? Should I leave the header Location Code empty, or choose one of the locations?

Additionally:

  • Could leaving the header empty cause any issue in inventory valuation or cost calculation?
  • Does the header Location Code affect Item Ledger Entries or costing in any way?
 

I want to ensure I'm following best practice and avoiding any unintended impact on costing and inventory valuation. Thanks,

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I have the same question (0)
  • Suggested answer
    CU21011755-0 Profile Picture
    4 on at

    1. Best Practice for the Header Location

    While there isn't a "hard rule," the recommended practice is to select the location where the majority of items will be received.

    • Efficiency: It minimizes data entry for the user.

    • Validation: If "Location Mandatory" is turned on in Inventory Setup, leaving the header blank might trigger a validation error depending on your specific version or customizations, even if lines are filled.

    2. Impact on Costing and Inventory Valuation

    You are correct that the header does not directly impact the Item Ledger Entry (ILE). However, here is the nuance:

    • Costing: Inventory valuation and costing (FIFO, Average, etc.) are calculated based on the Value Entry associated with the Item Ledger Entry. Since the ILE pulls the Location Code directly from the Purchase Line, the header has zero impact on your balance sheet or cost of goods sold.

    • In-Transit: If you were using Transfer Orders, location codes matter immensely for costing. But for a Purchase Order, as long as the line is correct, your valuation is safe.

    3. Key Considerations (The "Watch-outs")

    Even though costing isn't affected, leaving the header empty or using multiple locations can affect other areas:

    • Warehouse Documents: If the user plans to create a Warehouse Receipt or Put-away, Business Central usually filters these requests by Location Code. If lines are split across locations, you may need to create separate Warehouse Receipts for each location.

    • Reports: Some standard reports (like "Inventory – Vendor Purchase List") sometimes use the Header location for grouping. While this doesn't break the data, it might make reporting look "messy."

    In summary: The Purchase Header Location Code is a template tool. The Purchase Line Location Code is the accounting tool. Leaving the header blank or different from the lines will not cause issues with inventory valuation, as Business Central posts costs to the location specified on each individual line."

  • Ben Baxter Profile Picture
    6,678 Super User 2025 Season 2 on at
    This is a duplicate post, please see the other post with a reply here: PO with different line Locations – what should Header Location be?

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