Inventory Cost Update in Microsoft Dynamics NAV 2015

What I’ve done so far is generated an item “Coffee Mug – Standard”. I have put that on a sales order and a purchase order, and then I have received the purchase order and shipped the sales order. So right now we have two entries for the coffee mug.

View the Entries
I’m going to go and take a quick look at those entries. Entries > Ledger Entries.

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So, in this case we purchased 1000 and for $5 each, total amount $5000, and we sold 5 for $75. And so we do have 995 left off the original purchase; this is also in my history. Now ideally what we would like to see here is that there should be cost, total cost, on this transaction. There is sale but there is no cost. The cost should be $25 since we’re actually selling out of these 1000 that were bought for $5 each.

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Running the Manual Posting Routine (Adjust Cost  - Item Entries)
Now why is this not showing up? The demo system on NAV, it is set up not to calculate the cost automatically on posting and actually requires you to run a manual routine to post that.

So I’m going to do that right now. I’m going to go find this routine; it’s called “Adjust Cost - Item Entries”.

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This is a routine that you can run at any time. You can just go ahead and click OK.

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And there it goes.

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Viewing updated Cost
Now I’m going to take a look at my coffee mug again.

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Now I can see that my cost has been updated. And now it shows $25. This is accurate now. The profit is $50; cost $25; sale $75.

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Setting up Automatic Cost Posting

Now if I wanted this to be automatically posted always when I post to the system, I can set that up by going to the “Inventory Setup”.

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Here right away in the beginning it has something called Automatic Cost Posting. I can check that off and click “OK”. I’ll select “Always” for “Automatic Cost Adjustment” so every time there is a posting it’s going to adjust.

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The main reason for not having this on is that this is an overhead to the system, and it could be run at night if you have a high volume of transactions. 

Testing Automatic Cost Posting
So let’s see what the effect is. I’m going to actually go ahead and create another Sales Order as we’ve done in another video.

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Create a New Sales Order
Click on “New”.  

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I’m just going to quickly go through selling another one to The Cannon Group – this is my favorite customer to sell to.

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And pick the item – “Coffee Mug – Standard”.

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We are generally obsessed with coffee so hence the coffee mug. Enter “Quantity” of “10”.

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And we’re able to get $30 for this one; high profit. 

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Post, Ship and Invoice
Going to go ahead and “Post” this. 

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Select “Ship and Invoice”.

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View the Item Ledger Entries to confirm automation
Now I take a look at my item again. Go into Items.

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Then I go into view the transactions, Entries > Ledger Entries.

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Now I can see my Cost Amount automatically came in immediately. 

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I can drill into it right here, see the detail and it’s costed to GL and everything looks good.

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I can see that I have “985” in “Remaining Quantity” and sold (“Invoiced Quantity”) “15”.

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That was the demonstration of the cost posting in NAV and how you can turn that on to be automatic.