Drag and Drop Question You are implementing Dynamics 365 Business Central for a company. The company must perform inventory valuation according to the following business rules: - Include received…

Dynamics 365 Business Central - Inventory Valuation Month-End Process The Correct Three-Step Sequence | Order | Action | |-------|--------| | 1st | Perform the Adjust Cost – Item Entries batch job (Option 4) | | 2nd | Perform the Post Inventory Cost to G/L batch job (Option 1)…

Inventory

Question

Drag and Drop Question You are implementing Dynamics 365 Business Central for a company. The company must perform inventory valuation according to the following business rules: - Include received items that are not yet invoiced on balance sheets. - Lock inventory value by closing the month. You need to recommend a process for the company's accounting department to use. Which three actions should you recommend be performed in sequence? To answer, move the appropriate actions from the list of actions to the answer area and arrange them in the correct order. Answer:

Exhibit

Options

Option 1Perform the Post Inventory Cost to G/L batch job
Option 2Close the inventory period
Option 3Include Expected Cost on the Inventory Valuation report
Option 4Perform the Adjust Cost - Item entries batch job
Option 5Update Standard Cost

Explanation

Dynamics 365 Business Central - Inventory Valuation Month-End Process

The Correct Three-Step Sequence

Order	Action
1st	Perform the Adjust Cost – Item Entries batch job (Option 4)
2nd	Perform the Post Inventory Cost to G/L batch job (Option 1)
3rd	Close the inventory period (Option 2)

Options 3 (Include Expected Cost on report) and 5 (Update Standard Cost) are distractors - not part of this closing sequence.

Why This Order?

Step 1 - Adjust Cost – Item Entries

Must come first. This batch job reconciles item ledger entries with value entries and applies any outstanding cost adjustments (e.g., purchase invoice variance, freight charges posted after receipt). If you skip this, the G/L will receive incorrect values in Step 2. You cannot meaningfully close the period if costs are still unadjusted.

Step 2 - Post Inventory Cost to G/L

Requires Step 1 to be clean. This job takes the value entries created/updated by Step 1 and posts them as G/L entries. If Expected Cost Posting to G/L is enabled in Inventory Setup, this step also posts expected costs - satisfying the business rule about received-but-not-yet-invoiced items appearing on the balance sheet. Running this before adjusting costs would post stale numbers.

Step 3 - Close the Inventory Period

Must come last. Closing the inventory period locks it so no new item ledger entries can be backdated into it. This directly satisfies the business rule about locking inventory value by month end. Closing before posting to G/L would make it impossible (or at least disruptive) to complete Step 2 for that period.

Why the Distractors Are Wrong

Option	Why it's a distractor
Include Expected Cost on Inventory Valuation report	This is a report parameter, not a closing process step. It's used for verification/auditing, not for actually posting expected costs to the balance sheet. Expected costs are enabled in Inventory Setup, posted via Step 2.
Update Standard Cost	This is only relevant for items using the Standard costing method. It has nothing to do with period closing or expected cost posting.

Common Misconceptions

"I can close the period first, then post to G/L." No - closing locks entries. You must finish all posting before closing.
"Post to G/L handles the cost adjustment." No - Post to G/L only moves already-calculated value entries to G/L. Adjust Cost must run first.
"Enabling expected cost posting is a step in this sequence." No - that's a one-time Inventory Setup configuration, not a recurring month-end action.

Topics

#inventory valuation#expected cost posting#inventory period closing#balance sheet

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