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Incorrect posting effect of booking Purchase invoices

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Posted on by MD-05071026-0

We have implemented Business Central since Jan 2025 and are facing a unique problem.

When we are booking Purchase invoice following happens with the General Ledger Entries

COGS Debit

Inventory Asset Credit

Vendor Account Credit

COGS Debit.

So we are seeing two debits in COGS account instead of one.

We are not able to figure out why?

Microsoft Entra tenant ID: 7796ca81-386c-4266-9ab1-025de2a6c674, Environment: Production (Production)
Session ID (client): e3885fb7-16b3-451a-939f-2f9e6c675a84
Session ID (server): 816098
User telemetry ID: ad3845ea-39e6-43e7-abc8-028fe2dcb654

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Dynamics 365 Business Central

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Mansi Soni 8,907 Super User 2025 Season 2 on at

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Hello @MD-05071026-0,

In standard Business Central, COGS should only be posted at the time of item shipment or sale, not during purchase invoicing. To fix this, review your Inventory Posting Setup, ensure correct General Posting Setup, and verify that inventory cost flow is set up to defer COGS until the item is sold.

Hope this will help you to resolve it!

Regards,
Mansi Soni

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Gerardo Rentería Ga... 25,157 Most Valuable Professional on at

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Hi, good day
I hope this can help you, and give you some hints.

Posting Groups #1 – Item Purchase Posting | Totovic Dynamics 365 Blog

Best Regards
Gerardo

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YUN ZHU 95,331 Super User 2025 Season 2 on at

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Hi, Looks like the same question:

Effect of Purchase Bills

Thanks.

ZHU

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Jainam M. Kothari 15,631 Super User 2025 Season 2 on at

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May this can help :https://community.dynamics.com/forums/thread/details/?threadid=ad7eff6e-9a13-f011-998a-000d3a8ea979

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Ahmad Subhani 581 on at

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In General Posting Setup you specify 2 Wrong Accounts:

- Purchase Account

- Direct Cost Applied Account

You specify COGS account in these 2 accounts. Check that.

Mark the Answer as Verified if this is Helpful.

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Jeffrey Bulanadi 8,760 on at

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Hi

It’s a common point of confusion when transitioning to BC. Based on your description, it looks like the system is posting COGS twice during the purchase invoice process, which shouldn’t happen under standard configuration.

Here’s what might be causing it:

1. Incorrect Posting Setup

In standard BC behavior, COGS is posted during item sale/shipment, not during purchase invoicing

If you're seeing COGS at the time of purchase invoice posting, it’s likely due to a misconfiguration in the Inventory Posting Setup or General Posting Setup

Specifically, check if the Purchase Account or Direct Cost Applied Account is incorrectly mapped to the COGS account

2. Item Charges or Cost Adjustments

If item charges are applied during purchase invoicing, they may trigger additional cost postings

These can sometimes hit the COGS account if the Item Charge Assignment is misconfigured

3. Posting Preview Diagnostic

Use the Posting Preview feature before posting the invoice to see exactly which accounts are being hit

This can help isolate whether the duplicate COGS entry is coming from the item line, charge line, or system-level cost adjustment

4. Suggested Fixes

Review your Inventory Posting Setup and ensure that COGS is only mapped for sales transactions

Check the General Posting Setup for the combination of Gen. Bus. Posting Group and Gen. Prod. Posting Group used in the invoice

Validate that Item Charges are assigned correctly and not duplicating cost entries

Here’s a helpful reference

https://community.dynamics.com/forums/thread/details/?threadid=58bffdcc-8c59-f011-bec1-6045bdec90b9
https://learn.microsoft.com/en-us/dynamics365/business-central/finance-how-reverse-journal-posting

If you find this helpful, feel free to mark this as the suggested or verified answer.

Cheers
Jeffrey

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