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Inventory Valuation

HollandPolandHollandPoland Member Posts: 62
Hi users!

I find a problem on my Nav 4.2 installation. When I try to execute the Inventory Valuation report, I see some items that they have quantity = 0 and cost > 0. I have in Item table, costing method = "average" and the item uses Assembly List BOM.

So I try to execute "Adjust Cost - Item Entries" report, but it doesn't resolve the problem. I try to uncheck "Cost is Adjusted" in Item table, I check "Applied Etry to Adjust" in Item Ledger Entry table and I check "Cost Application" in Item Application Entry table (for the entry in Item Ledger Entry), and I re-execute the adjust cost's report and I see that the inventory valuation is correct (quantity = 0 and cost = 0).

Is it a right procedure? Why negative entries have not check "Cost application" in Item Application Entry?

Thank you for your replies.

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    SD-JRSD-JR Member Posts: 94
    Hi

    This can and will arise if you allow stock run negative - you can't stand over the costing in these situations - not all costs will be applied correctly (absorbed) in a negative stock position

    If you have made the "cost is adjusted" field editable and can use this to reset the item and let the adj cost routine do it's thing and resolve the solution then fine.

    The only issue may be that you are posting cost adjustments into older financial periods - just review your settings with your finance department.
    Regards,

    Ger
    Simply Dynamics Ltd
    skype: gf.simplydynamics
    Web: www.simplydynamics.ie
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    crisnicolascrisnicolas Member Posts: 177
    I'm having this issue and I do not really know why this is happening.

    SD-JR, you said that "Cost Application" field not being checked in Item Application Entry table is because of negative stocks.

    I actually have an item that did not have negative stocks.
    Positive entry has been applied to multiple negative entries, but only the last negative entry has the "Cost Application" field checked.

    The initial positive entry was 32 units at a cost of 166 per unit.
    All negative entries have been done at a unit cost of 166.
    Since only the last entry has the "Cost Application" field checked, the Adjust Cost process has made a huge rounding value entry on the initial positive entry, so that the whole positive entry is valued at the same cost as all negative entries that have been cost applied to it, that is, all 32 units valued at a total cost of 166 (5,18 per unit).
    This leads to a wrong Unit Cost of the item, and also leads to get 0 stock and negative value.

    I'm now checking if this is happening on all my items, if none of them have actually had negative stock at some point, and I'm checking the code to see where, when and how the "Cost Application" field is checked in Item Application Entry table.

    Any help would be highly appreciated.
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    Stardust77Stardust77 Member Posts: 95
    crisnicolas, what costing method are you using? Also 'Average'?
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    AndwianAndwian Member Posts: 627
    There are 2 causes:
    1. There are some Value Entries of the Outbound Entries that lies in the next period other than the Posting Date that the Inventory reach 0. Try to run the Inventory Valuation report to the later date. If it is 0, than this is the cause.

    2. There are known bugs:
    a. The Costing Method is average, using Manufacturing (BOM)
    b. The Costing Method is average, and there is Outbound transaction that posted before the Inbound Entries.
    Regards,
    Andwian
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    crisnicolascrisnicolas Member Posts: 177
    Stardust77 wrote:
    crisnicolas, what costing method are you using? Also 'Average'?

    When I wrote the post I thought it was average, but then I realized the item I was looking at was actually Standard.

    I will check the posting dates of the outbound entries.
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    crisnicolascrisnicolas Member Posts: 177
    Andwian wrote:
    There are 2 causes:
    1. There are some Value Entries of the Outbound Entries that lies in the next period other than the Posting Date that the Inventory reach 0. Try to run the Inventory Valuation report to the later date. If it is 0, than this is the cause.

    2. There are known bugs:
    a. The Costing Method is average, using Manufacturing (BOM)
    b. The Costing Method is average, and there is Outbound transaction that posted before the Inbound Entries.

    In my case, the inventory of the item did never reach 0.
    The item started having movements in 01/05/2009 with a positive adjustment of 32 units. Those 32 units have gotten out of the stock little by little, the last movement was in 09/06/2010.
    In the middle, the item has had a Purchase and a couple of sales returns. So it never reached 0.

    There is only one sale for which one of the value entries lies in the next month, instead of having a posting date in the same month. It is not the sale that made the initial inbound entry to have 0 remaining quantity, though.

    If the known bugs are only for average costing method, then that is not my case.
    The item I'm looking at has an Standard costing method. The item has a BOM defined, even though it has always been purchased instead of manufactured...

    The thing is, in costing methods other than average, field "Cost Application" in Item Application Entry table should always be checked, right?
    In my case, only the inbound entry and the last of the outbound entries do have this field checked.

    I manually check that field on all outbound entries, uncheck the Cost is Adjusted field in Item table, run the Adjust cost process, but the valuation remains the same, nothing changed.

    I’d like to know two things:
    1. How to correct valuation
    2. Why the Cost Application field in Item Application Entry is not properly populated.
    I did a search for that field using the developer. It looks like it only gets populated in function InsertApplEntry in CU22.
    CASE TRUE OF
          Item."Costing Method" <> Item."Costing Method"::Average:
            ItemApplnEntry."Cost Application" := TRUE;
          ItemJnlLine.Correction:
            BEGIN
              ApplItemLedgEntry.GET(ItemApplnEntry."Item Ledger Entry No.");
              ItemApplnEntry."Cost Application" :=
                (ApplItemLedgEntry.Quantity > 0) OR (ApplItemLedgEntry."Applies-to Entry" <> 0);
            END;
          ELSE
            IF (ItemJnlLine."Applies-to Entry" <> 0) OR
               (CostToApply AND ItemJnlLine.IsInbound)
            THEN
              ItemApplnEntry."Cost Application" := TRUE;
        END;
    

    So, that field should be TRUE, as the Item is not average. The only reason I can think of is that Item record doesn’t have the real item at that time, but some other Item. I’ll check that, but any comment would be really appreciated.

    Sorry for such a long post.
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    crisnicolascrisnicolas Member Posts: 177
    The thing is, in costing methods other than average, field "Cost Application" in Item Application Entry table should always be checked, right?
    In my case, only the inbound entry and the last of the outbound entries do have this field checked.

    I manually check that field on all outbound entries, uncheck the Cost is Adjusted field in Item table, run the Adjust cost process, but the valuation remains the same, nothing changed.

    Field "Applied Entry to Adjust" in table Item Ledger Entry had to be checked as well.
    Now I run the Adjust Cost process and valuation is ok.

    I still don't know why the Cost Application field was unchecked in first place, though.
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    AndwianAndwian Member Posts: 627
    I still don't know why the Cost Application field was unchecked in first place, though.
    Where can I find the Cost Application field?
    I could not find it in Item Ledger Entry. And there is no such table named Application Entry.

    I am using ID version.
    Regards,
    Andwian
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    crisnicolascrisnicolas Member Posts: 177
    Andwian wrote:
    I still don't know why the Cost Application field was unchecked in first place, though.
    Where can I find the Cost Application field?
    I could not find it in Item Ledger Entry. And there is no such table named Application Entry.

    I am using ID version.

    Table 339 Item Application Entry
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