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Dynamics 365 Community / Forums / Small and medium business | Business Central, N... / Exact Cost Reversing M...
Small and medium business | Business Central, N...
Answered

Exact Cost Reversing Manadatory

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Posted on by JE-20081519-0 3,549
Hi:
 
I'm finding conflicting information online as to what feature the "Exact Cost Reversing Mandatory" toggle in Sales & Receivables Setup is supposed to conduct.
 
One person says that this has to do with the dollar amount that the item is returned for. 
 
Another says that turning on the toggle simply means that a return will not be performed if the corresponding Sales Invoice hasn't been posted.
 
So, what function does this toggle serve?
 
Thanks!
 
John
Categories:
Dynamics 365 Business Central
I have the same question (0)
  • Verified answer
    Mansi Soni Profile Picture
    Mansi Soni 8,951 Super User 2026 Season 1 on at
    Hello, 

    When this toggle is enabled (True):
    Business Central requires that item returns or credit memos reverse the exact same cost as the original sale.
    This only applies to items tracked by costing methods (like FIFO, LIFO, etc.).
    It ensures the cost posted to the general ledger for the return matches exactly the cost from the original sale (from the original outbound entry).
    The system links the return line to the original sale line and reuses its cost — this is crucial for correct cost of goods sold (COGS) reporting.

    What does this mean in practice?

    If a sales return is processed and the Exact Cost Reversing Mandatory is ON, the system forces the user to link the return to the exact outbound item ledger entry created during the original sale.
    If no original sale (i.e., sales invoice) exists for that item, you cannot post the return — which aligns with the second explanation you read: it requires a prior sale to reverse the cost.

    Summary of Behavior:

    So, both statements you found are partially correct, but incomplete:

    Dollar amount relevance — correct in that it ensures cost figures are matched.
    Invoice requirement — also true, because reversing requires an original transaction to pull cost from.

    Regards,
    Mansi Soni


     
  • Suggested answer
    RockwithNav Profile Picture
    RockwithNav 8,967 Super User 2026 Season 1 on at
    To make it very simple for you, You cannot reverse any transaction until and unless you go and apply to the corresponding posted invoice for which you want the reversal, so that system can do Exact Cost Reversing.
     
    If you do without applying then you will end up with an error message.
  • Gerardo Rentería García Profile Picture
    Gerardo Rentería Ga... 25,555 Most Valuable Professional on at

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