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Cost is a "Wash"?

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Posted on by john.ellis

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Hi:

In a test company I tested the posting of a sales invoice, and pasted below are the resulting General Ledger Entries.

5000 is Cost of Goods Sold, while 1200 is Inventory. FIFO is the inventory valuation method.

It would appear that posting both increased and decreased Cost of Goods Sold and Inventory, as if the transaction had been a "wash" (i.e. no effect).

Why?

Thanks!

John

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Dynamics 365 Business Central

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Dallefeld 11,425 User Group Leader on at

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RE: Cost is a "Wash"?

I suggest reaching out to your partner, so they can log into your system and dig a little deeper. I truly believe its something in setup.
john.ellis 3,482 on at

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RE: Cost is a "Wash"?

Nope, same result...

By the way, I don't have any account in the "Purch. Account" of General Posting Setup. Should I?
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MahGah 15,428 on at

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RE: Cost is a "Wash"?

That is a safer way. It also help if you can close your browser and open. Also, after login back create new SO as well and try.
john.ellis 3,482 on at

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RE: Cost is a "Wash"?

Since 5000 is the only cost of goods sold account and since there is no comparable expense account, I changed the Inventory Adjustment account and the Direct Cost account from 1200 to 5000.

Unfortunately, I got the same original result. Do I need to log out and log back in and try the sales preview posting, again?
Dallefeld 11,425 User Group Leader on at

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RE: Cost is a "Wash"?

Okay, your inventory adjustment account in general posting setup should be an account in the cost of goods section of your income statement or an expense account but NOT a balance sheet account. Same goes for the Direct Cost applied account.

There are only two columns in general posting setup that could possibly have balance sheet accounts and both are used for expected cost posting (COGS Interim and Inv Accrual Interim)

Likewise on your Inventory Posting Setup, the first 3 columns should always be balance sheet accounts.

I know you are saying that this is only a problem with Lot tracked items but you are probably having an inventory to GL reconciliation problem as well.

I would be concerned also if in General Posting Setup you have put your inventory account in the Purchase Account column.
john.ellis 3,482 on at

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RE: Cost is a "Wash"?

Hi:

Below are some screenshots. Please let me know what else is needed.

Thanks!

John
Dallefeld 11,425 User Group Leader on at

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RE: Cost is a "Wash"?

The problem that we are all having is that nothing works differently in the general ledger posting for lot numbered items than for items without lots.

I still believe it's a setup issue as I've never seen such an issue.

Do you have any add-ons to Business Central?

Also, more screenshots would be helpful...
john.ellis 3,482 on at

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RE: Cost is a "Wash"?

Automatic Cost Posting is set to "on".

I did discover that this lot-numbered item is in a different General Product Posting Group from the other items. (It's the only lot-numbered item.) But, there is no difference in accounting between that group and the others.

Is there anything else that I can check?
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MahGah 15,428 on at

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RE: Cost is a "Wash"?

Thanks

It depends. if in Inventory Setup you have Automatic Cost Adjustment to Always then the answer is now. Otherwise you need to run that.
john.ellis 3,482 on at

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RE: Cost is a "Wash"?

1) buy

2) only one posting group for all items

3) I can try this. Does this have to be run often?