If you invoice a single shipment using more than one invoice and the costs of those invoices differ, you could see the new warning message we have added.
The cost of the invoice does not match the purchase receipt cost. Posting updates the total quantity of the purchase receipt with this cost and your inventory and general ledger will not balance. Do you want to continue?
How can this come into play and why did we add it? Let’s take the following example -
You create a PO for a quantity of 100 at a Unit Cost of $1.
You enter a Shipment transaction and receive all 100 of those items at $1 for a $100 debit to your inventory account.
You then enter an Invoice that only partially invoices the 100 items you received. Let’s say 75 of them. If you do it at a cost of $1, there is no affect to your Inventory account in GL.
Then let’s say you enter a second invoice for the remaining 25, and those cost you more, e.g. $1.50 each. Upon entry of that Unit Cost, you will see the following:
If you answer Yes to this and continue with your transaction and post, your inventory account in GL is updated with (25 x $0.50 variance) $12.50.
However if you look at your receipt layer you will see that the whole quantity of 100 is valued at $1.50 for a total of $150 even though the inventory account in GL only has $112.50. (For you HITB users, the $150 value is reflected on the HITB report too.)
This is what the message was warning you about!! Since there is only 1 receipt layer for this shipment we have to update the whole layer (QTY 100) for the cost, not just the 25 you invoiced.
This out of balance situation is nothing new. Microsoft Dynamics GP has functioned like this as long as I can remember. However, the fact that we are warning you about it, is new. Our hope is that this warning will make you think twice about the ramifications of matching more than 1 invoice to a single shipment and have you consider breaking your shipments into multiple line items or multiple documents instead. That way you will have multiple lines/documents to invoice against and can work with 1:1 ratios and avoid this scenario.
Original post found in this blog article by Pam Peterson: New cost warning in Microsoft Dynamics GP 2010 SP3 for cost variances - Microsoft Dynamics GP Community