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Dynamics 365 Community / Forums / Small and medium business | Business Central, N... / Adjusting inventory av...
Small and medium business | Business Central, N...
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Adjusting inventory avg cost as at a past cutover date

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Posted on by ploo 28
Hi inventory gurus,
 
I'm working on inventory cutover and know that item quantities x unit avg cost (Average cost method) must tally with the Inventory Account in the Balance Sheet.
 
At the end of the month (e.g. Feb), I have the quantities for items in stock (from the 3PL source).  I can use the item quantities for my Item Journal used to create the cutover value that must tally with Inventory Account.
 
BUT, the avg cost of each item will only be reconciled in the existing system by the accountant, and it is only ready in the 3rd week of March.
To enable my cutover, I would use the Jan. month reconciled item avg costs - this will produce an Inventory Amount <> Inventory Account end of Feb.
 
There will be sales and purchase transactions between 1 Mar and 3rd week of March when the Feb. month-end avg item costs are reconciled to end Feb inventory account.
 
Can I then use Item Revaluation for the items to adjust the avg unit cost at end Feb from the Jan. reconciled cost to the Feb reconciled cost?
Is this the correct?
Or is there a better approach?
 
Thank you
Peter
Categories:
Dynamics 365 Business Central
  • Suggested answer
    Jun Wang Profile Picture
    Jun Wang 7,681 Super User 2025 Season 1 on at
    Adjusting inventory avg cost as at a past cutover date
    please note that revaluate item cost which has average costing method is tricky than items using other costing method. when you run the revaluation journal for an average cost item, you have to adjust all invoiced cost for that item. 
    Meaning if you only want to adjust invoiced item for a certain period, this might not be possible per my knowledge. 
     
    I'd recommend you to test it out fully before making any changes in prod. 
  • Suggested answer
    KasparsSemjonovs Profile Picture
    KasparsSemjonovs 4,177 Super User 2025 Season 1 on at
    Adjusting inventory avg cost as at a past cutover date
    Yes, You can register the quantities through Item Journal, and at later date use Revaluation journal to adjust the initial inventory value. 

    Make sure the Inventory Adjustment Account is correct as You need in General Posting Setup for each group, so the changes in value are registered to the same Inventory account.

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