About physical and financial updates [AX 2012]
Updated: March 8, 2011
Applies To: Microsoft Dynamics AX 2012 R2, Microsoft Dynamics AX 2012 Feature Pack, Microsoft Dynamics AX 2012
This topic provides an overview of which types of transactions increase or decrease inventory quantities.
Inventory transactions can be physically updated and financially updated in Microsoft Dynamics AX, and certain types of physical and financial transactions increase inventory quantities, whereas others decrease the quantity.
When a financial receipt transaction is posted, the status of the transaction record that increases the quantity is “Purchased.” The following transactions are considered financial increases:
Sales order invoice for a return
Production order costing
Positive quantity inventory journals, such as movement, profit loss, counting journals, bills of material, and transfer
Transactions that increase quantity are posted at the running average cost price. Microsoft Dynamics AX calculates a running average cost price that is based on the cost of each of these transactions for each inventory dimension that is being tracked financially. For information about how to run average cost price, see About running average cost price.
Microsoft Dynamics AX uses the calculated running average cost price when a transaction that decreases quantity is posted, regardless of which inventory model is associates with that inventory. This requires that the transaction that decreases quantity was not previously marked to another transaction before posting.
If the physical on-hand inventory goes negative, Microsoft Dynamics AX uses the inventory cost that is defined for the item in the Item form. Click Inventory and warehouse management > Periodic > Forecast > Entry > Items.
If multisite functionality is enabled, this cost will instead be the inventory cost that is defined for a site in the Default order settings form.
When a physical issue transaction is posted, the status of the transaction record is “Deducted.” The following transactions are considered physical issues:
Production order picking list journal
Sales order packing slip
Purchase order packing slip return
When a financial transaction is posted, the status of the transaction record is “Sold.” The following transactions are considered financial issues:
Production order ended
Sales order invoice
Vendor invoice return
Negative quantity inventory journals, such as movement, profit loss, counting journal, bills of material, and transfer
Transactions that decrease quantity are posted at the running average cost price. Thus, the inventory close procedure is required to settle issue transactions to receipt transactions based on the inventory model that is assigned to each item.