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Applied entry to adjust Boolean in item ledger entry

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In Item ledger entry i did not understand the use of applied entry to Adjust Boolean, when this Boolean mark as yes, what is the use of it. If anyone can explain what is the use of that Boolean?
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    Valentin Castravet Profile Picture
    Valentin Castravet 25,565 Super User 2024 Season 2 on at
    Applied entry to adjust Boolean in item ledger entry
    It's one of the three booleans used by the system to identify which items need cost adjustments when the "Adjust Cost - Item Entries" process is run. Note that its only used for items that use FIFO, LIFO, Standard, and Specific costing methods

    When an inbound entry (such as a purchase) is applied to an outbound entry (like a sale), the system will mark the inbound entry's "Applied Entry to Adjust" field as true. This indicates that the cost adjustment process needs to update the costs associated with these entries to ensure accurate inventory valuation and cost of goods sold calculations. You'll only see the value of this field change if cost adjustment is not set to run automatically.
     
    Here's how you can see the value of this field change:
     
    1. In the Inventory Setup Page set Automatic Cost Adjustment to Never
    2. Find an item with a quantity in stock of 0, use the item journal to do a positive adjustment for a quantity of 1
    3. Look in the item ledger entries, the Applied Entry to Adjust field will be set to No
    4. Use the item journal to do a negative adjustment for the item in step 2, the Applied Entry to Adjust will now be set to Yes for the item ledger entry created in step 2. As mentioned, this field will be set to Yes when an inbound entry is applied to an outbound entry. 
    5. Run Adjust Cost - Item Entries, the Applied Entry to Adjust will now be set to No for the item ledger entry created in step 2
     

     
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    YUN ZHU Profile Picture
    YUN ZHU 76,516 Super User 2024 Season 2 on at
    Applied entry to adjust Boolean in item ledger entry
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    Khushbu Rajvi. Profile Picture
    Khushbu Rajvi. 7,275 on at

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