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Introduction
INTRODUCTION
Welcome
We know training is a vital component of retaining the value of your Microsoft Dynamics AX 2009 investment. Our quality training from industry experts keeps you up-to-date on your solution and helps you develop the skills necessary for fully maximizing the value of your solution. Whether you choose Online Training, Classroom Training, or Training Materials; there is a type of training to meet everyone's needs. Choose the training type that best suits you so you can stay ahead of the competition.
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Microsoft Dynamics Courseware

The Microsoft Dynamics Courseware consists of detailed training manuals, designed from a training perspective. These manuals include advanced topics as well as training objectives, exercises, interactions and quizzes. Look for a complete list of manuals available for purchase on the Microsoft Dynamics website: www.microsoft.com/Dynamics.
Microsoft Official Training Materials for Microsoft Dynamics Your use of this content is subject to your current services agreement
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Trade and Logistics I in Microsoft Dynamics AX 2009
Microsoft Dynamics Courseware Contents

Test Your Skills
Within the Microsoft Dynamics Training Materials you find a variety of different exercises. These exercises are offered in three levels to accommodate the variety of knowledge and expertise of each student. We suggest you try the level three exercises first, if you need help completing the task look to the information in the level two exercises. If you need further assistance each step of the task is outlined in the level one exercise.
Challenge Yourself!
Level 3 exercises are the most challenging. These exercises are designed for the experienced student who requires little instruction to complete the required task.
Need a Little Help?

Level 2 exercises are designed to challenge students, while providing some assistance. These exercises do not provide step by step instructions, however, do provide you with helpful hints and more information to complete the exercise.
Step by Step
Level 1 exercises are geared towards new users who require detailed instructions and explanations to complete the exercise. Level 1 exercises guide you through the task, step by step, including navigation.
Quick Interaction: Lessons Learned

At the end of each chapter within the Microsoft Dynamics Training Material, you find a Quick Interaction: Lessons Learned page. This interaction is designed to provide the student with a moment to reflect on the material they have learned. By outlining three key points from the chapter, the student is maximizing knowledge retention, and providing themselves with an excellent resource for reviewing key points after class.
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Introduction
Documentation Conventions
The following conventions and icons are used throughout this documentation to help you quickly and effectively navigate through the information.
CAUTION: Cautions are found throughout the training manual and are preceded by the word CAUTION in bold. Cautions are used to remind you of a specific result of a specific action which may be undesirable. HINT: Hints are found throughout the training manual and are preceded by the word HINT in bold. Hints are used to suggest time-saving features or alternative methods for accomplishing a specific task. NOTE: Notes are found throughout the training manual and are preceded by the word NOTE in bold. Notes are used to provide information which, while not critical, may be valuable to an end user. BEYOND THE BASICS: Advanced information found throughout the training manual is preceded by the words BEYOND THE BASICS in bold. Beyond the Basics provides additional detail, outside of standard functionality, that may help you to more optimally use the application. EXAMPLE: Examples are found throughout the training manual and are preceded by the word EXAMPLE in bold. Examples bring to light business scenarios that may better explain how an application can be used to address a business problem.
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Student Objectives
What do you hope to learn by participating in this course? List three main objectives below. 1.
2.
3.
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Chapter 1: Introduction to Trade and Logistics
CHAPTER 1: INTRODUCTION TO TRADE AND LOGISTICS

Objectives
The objectives are: Review the concepts of Logistics and Inventory Management Examine Logistics and Inventory features in Microsoft Dynamics AX 2009 Determine the information flow in Microsoft Dynamics AX 2009
Introduction
Introduction to Trade and Logistics provides an overview of Microsoft Dynamics AX 2009 features in Trade and Logistics, which is the flow of purchase orders, sales orders and inventory throughout a company.
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Logistics and Inventory Management

Logistics is defined as the process of planning, implementing, and controlling the efficient and cost-effective flow, and storage of the following: Raw materials In-process inventory Finished goods Related information from the point of origin to the point of consumption
Specifically, logistics helps companies meet customer requirements. Inventory is the material and supplies a business carries either for sale or to provide input in the production process. Inventory consists of many different items held by the company, which can include: Raw materials and supplies Goods in production Sub assemblies Finished goods ready for sale
Inventory management is planning and controlling inventory from the raw material stage to the customer. Companies must consider inventory at every planning level. Companies can manage inventory at both the aggregate level and the item level. A company's management team must establish decisive rules about inventory items including consideration of the following: The most important items to keep in inventory The control of items through a company The quantity of inventory to be ordered The timing of when an item should be ordered
Microsoft Dynamics AX manages the cost and quantities of the items bought and sold. Regardless of whether a company is a retail business with merchandise inventory or a manufacturing company with finished goods, materials, and work in process, the system provides inventory from two standpoints: Physical and Financial.
Logistics and Inventory Features

Microsoft Dynamics AX 2009 includes two types of inventory: physical and financial. These inventory types include many dynamic features that help companies keep status of the financial and physical value of their inventory, and profits and improve customer service.
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Additionally, the new mulitisite feature provides the Site dimension that helps a company capture and reflect the movement and status of items between multiple production or distributions sites.
Physical Inventory
Physical inventory is the physical movement, status and control of items throughout the supply chain in a company. Specific features can help companies control these items. These features include: Inventory tracking Master planning Automatic ordering Reservations Inventory transactions Quality management
Inventory Tracking Inventory tracking tracks inventory items by using: Item ID Lot ID Configuration specifications, which can consist of the following individual identifiers: o o o o o o o o o Size Color Configuration Warehouse Site Batch number Location Pallet ID Serial number
Master Planning Master planning calculates what is necessary to fill an order when it is received. Master planning is covered in the Microsoft Dynamics AX 2009 Master Planning course. Automated Ordering After calculating what is needed to fill an order, Microsoft Dynamics AX 2009 in cases of insufficient inventory - will automatically create production and purchase order proposals to complete a customer request.
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Reservations Microsoft Dynamics AX 2009 reserves items for sale or production. This puts the items on hold and guarantees their availability for a specific order. Inventory Transactions When increases and decreases in inventory occur due to sales and purchase orders, Microsoft Dynamics AX 2009 automatically updates inventory information to reflect the actual levels. Quality Management Full integration for managing quality processes and non conformances on items is provided in Microsoft Dynamics AX 2009. It helps manage, track and handle quality processes and issues throughout a company.
Financial Inventory
Financial inventory is the financial value of a company's inventory. Specific features can help companies keep track of the financial value. These features include: Inventory value ABC Classifications Forecasting
Inventory Value When companies use the most current information from all related modules in the system, they can calculate inventory value at any time. Inventory costing and evaluation is covered in the Microsoft Dynamics AX 2009 Inventory Costing and Valuation course. ABC Classifications Companies can analyze which items are the most profitable from a sales perspective, and consider the carrying costs (how long inventory remains in stock and other factors) of the item(s) in inventory. Forecasting Based on the calculations that Microsoft Dynamics AX 2009 performs, companies can produce sales and purchasing forecasts. Companies can project future sales by using the statistics on quantities sold and the company's own estimates. From purchasing trends, a company can estimate its budget.
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Multisite
Supply chain management involves a highly interactive process of controlling, planning, and implementing all the activities associated with moving goods from the raw material stage to the end user stage, as efficiently as possible, with the lowest cost and the highest quality. Regardless of whether a company operates with a single production/distribution site or multiple sites in different geographical locations, the system must capture and reflect the elements that will enable optimal and appropriate decision making and monitoring throughout the company. Adding multiple site capability to Microsoft Dynamics AX 2009 therefore affects all functional feature areas that support supply chain transactions that are relevant to the various sites. The following table provides an overview of how multisite functionality is integrated into the various Inventory, Trade and Source feature areas. Some of these features are covered as an integrated part of the topics in the Microsoft Dynamics AX 2009 Trade and Logistics series. Multisite Feature Replenishment control by warehouse, for example, min / max and standard quantity by warehouse Preferred supplier by combination of item and warehouse / site (currently item level only) Replenishment logic across sites (basic modeling of replenishment routes extended) Decentralizing of pick, pack and ship (output orders) by facilitating a site grouping Sales order processing support with centralized order taking. Static available to promise (ATP) logic across sites. Sales lines associated with one site (validate site warehouse relation). Method of delivery by sales lines. On-hand visibility extended with filtering by site. Ability to aggregate demand for each site or across sites by supplier. Multiple ship to by line and site. Validate three way matching scenarios effect with site level matching. Purchase order processing support / centralized purchasing. Source Area Inventory Inventory Inventory Trade Trade
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Information Flow
The Inventory management module is linked to related modules to provide an efficient flow of information through Microsoft Dynamics AX 2009. The information flow matches the inventory flow and provides lots of information about the financial aspect of the process. Ledger transactions and Inventory transactions are the backbones of Logistics. Inventory information is linked to the following: Accounts Receivable Accounts Payable Master Planning Production Product Builder Human Resources Projects General Ledger
The Main form in Inventory is the Items form. It contains information about the company's goods, services, and bills of material. Similarly, the Accounts receivable, Accounts payable, and Master planning modules also use the information that is stored in the Items form.
Summary
The Introduction to Trade and Logistics course reviewed the following: Concepts of Trade and Logistics, in addition to Inventory Management Feature set of Microsoft Dynamics AX 2009 within the Trade and Logistics area Information flow of Inventory Management in Microsoft Dynamics AX 2009
The features within the Trade and Logistics area of Microsoft Dynamics AX 2009 will help companies keep track of the flow of purchase orders, sales orders and inventory across all distribution and production sites; both physically and financially.
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Take a moment and write down three key points you have learned from this chapter: 1.
2.
3.
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Chapter 2: Inventory
CHAPTER 2: INVENTORY
Objectives
The objectives are: Set up an Item group Determine posting types associated with item groups and investigate what they are used for Set up an inventory model group and state the effect of different parameter settings in the groups on items Set up a Dimension group Work with the Inventory dimensions form Create item dimension combinations Set up Inventory management parameters Create an item and state the effect of setting in the Items form on the item Set up default order settings Set up Units of measurement and Unit conversion Set up a Warehouse and attach it to an item Set up Item pricing, automatic updates of item prices and Costing versions
Introduction
Inventory discusses creating and setting up new items. Creating new items is performed through the Inventory management module. All item-based data that is created in this module is used by the company accounts for purchases, sales, warehouse management, quality management, inventory journals, production, and projects. When you create a new item in Microsoft Dynamics AX 2009, you must, as a minimum, specify the following settings: Item number Item group Item type Inventory model group Dimension group
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This course covers the setup of these mandatory item setup elements and identifies how different settings affect item behavior. Additionally, it covers several non-mandatory setup elements that are important to item creation such as warehouse setup, unit conversion, and item pricing.
Item Groups
In every Microsoft DynamicsAX 2009 implementation, you must set up at least one item group, because it is a prerequisite for creating a new item. Consider the structure of item groups carefully before you continue with the setup, because as soon as an item group has been created and used (meaning transactions have been posted against the item group), the item group cannot be deleted. Item groups serve three main purposes in Microsoft Dynamics AX 2009: Post each item group to different general ledger accounts. Use item groups for retrieving sales and purchase data on groups of products. Use item groups to report detailed financial information, queries, and create other ad hoc reports.
To create an Item group, click Inventory management > Setup > Item group. Specify which accounts from the Chart of accounts to use for the various account types in each area.
Overview Tab
View the following fields on the Overview tab: Field name Item group Name Description Identifying code for the Item group Descriptive name for the Item group. For example, the name that is used on reports
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FIGURE 2.1 ITEM GROUP FORM - OVERVIEW TAB
Sales Order Tab

The Sales order tab shows the accounts that are used for sales order related posting for the item group.
FIGURE 2.2 ITEM GROUP FORM - SALES ORDER TAB
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The Sales order tab contains the following field groups: Packing slip Commission Invoice Sales tax
Sales Order Tab - Packing Slip Field Group

The Packing slip field group contains the following posting accounts that are used for sales order packing slip posting: Packing slip: Transactions are generated in this account when the item is packing slip updated (issue). Verify the following for posting to occur: o o o Post physical inventory in the inventory model groups attached to the item must be selected. Post packing slip in ledger in Accounts receivable, Setup, Parameters is selected. Posting in ledger can be done periodically by using the Post estimates periodically parameter in Inventory management, Setup, Parameters, General tab.
Packing slip offset: Transactions are generated in this account when the item is packing slip updated (consumption). Parameter setup for the item inventory model group and Accounts receivable Parameters must be the same as for packing slip posting to post to this account.
Sales Order Tab - Invoice Field Group

The Invoice field group contains the following posting accounts that are used for sales order invoice posting: Issue: Involves posting issues from inventory, usually a status account. The account is credited by selling the item at the item cost price multiplied by its quantity. This account is also known as the inventory account. Consumption: Involves posting item consumption. Posting is usually to a profit and loss account. The account is debited by selling the item at the item cost price multiplied by quantity and offsets the Issue account.
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Revenue: The item sales price multiplied by the quantity, excluding tax, is credited in this account when the sales order is invoice updated. Discount: If an account is specified for line discounts, sales are posted before the line discount is deducted, and the line discount is debited in Discount. If no account is specified for line discounts, Revenue minus the line discount is posted, and the line discount will not appear directly in an account in the ledger. This account segregates discount amounts into a separate General ledger account. Using this account facilitates tracking of the value of discounts granted, and provides data with which to better gauge the price of goods sold.
Sales Order Tab - Commission Field Group

The Commission field group contains the following posting accounts that are used for sales order commission posting: Commission - If you calculate commissions when posting the invoice, the system debits the commission in this account. Commission offset - If you calculate commissions when posting the invoice, the system credits the commission in this account. This account segregates the amount of the invoice paid out in commissions. In this manner, the amount to be paid in commissions is immediately offset from the invoice.
Sales Order Tab - Sales Tax Field Group

The Sales tax field group contains the Item sales tax group field. This is where you specify a default item sales tax group for items in the selected item group.
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Purchase Order Tab
The Purchase order tab shows the accounts that are used for purchase order related posting for the item group.
FIGURE 2.3 ITEM GROUP FORM - PURCHASE ORDER TAB
The Purchase order tab contains the following field groups: Packing slip Invoice Purchase tax Credit note Fixed receipt price
Purchase Order Tab - Packing Slip Field Group

The Packing slip field group contains the following posting accounts that are used for purchase order packing slip posting: Packing slip: Use this account for posting expected revenue when you are updating packing slips. When the item is received, this account is debited with the packing slip update. Posting to this account occurs if: o o Post physical inventory in the inventory model group attached to the item is selected. Post packing slip in ledger in Accounts payable, Setup, Parameters is selected.
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The transactions are based on the item's cost price at the time of the update. Packing slip offset: Use this account for offsetting posted expected revenue when you update packing slips. When the item is received, this account is credited with the packing slip update. The same inventory model group and Accounts payable Parameters apply to posting to this account as they do for Packing slip posting. The transactions are based on the item's cost price at the time of the update. Packing slip purchase, Packing slip purchase - offset and Packing slip tax - Use these posting types to accrue vendors receipts, eventually separating projected tax from received not yet invoiced.
Purchase Order Tab - Invoice Field Group

The Invoice field group contains the following posting accounts that are used for purchase order invoice posting: Receipt: When the purchase is invoice-updated, the item's realized cost is debited in the account, and credited in the vendor summary account based on the posting setup in the Accounts payable module. Discount: Depending on whether an account is specified in this field, the posting occurs in different ways: o If an account for line discounts is specified, then the value of the inventory receipt is debited in the Receipt field before the line discount is deducted and the line discount is credited separately in this Discount account. If no account is specified for line discounts, the inventory receipt is posted after deduction of the discount and the discount will not appear directly in a ledger account.
Charge and Stock Variation: Charge and Stock variation enables you to post stock movement through a profit and loss account before capitalizing it in inventory. This offers the benefit of having a footprint in the profit and loss account of the stock variation that occurs during a fiscal period. Fixed asset receipt: Enter the account number to use for posting the receipt of items in this group. This account is updated when you post an invoice with an assigned fixed asset, and the system is set up to not post an acquisition transaction for the asset when you post the invoice.
Purchase Order Tab - Purchase Tax and Credit Note Field Groups
The Purchase tax field group contains the Item sales tax group field. This is where you specify a default item sales tax group for items in the selected item group.
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The Credit note field group contains the following posting accounts that are used for purchase order credit note posting: Consumption - Use this account to post item consumption for a purchase credit note, where the cost price differs from the purchase price. To use the account, you must have selected the Post financial inventory parameter in the item's inventory model group. This account is helpful when you use Standard cost as the Inventory model group.
EXAMPLE: You purchase an item for 500 U.S. Dollars (USD). Later, when you return it, the Standard cost is 520 USD. The variance of 20 USD would be posted to this account.
Purchase Order Tab - Fixed Receipt Price Field Group

The Fixed receipt price field group contains the following posting accounts that are used for posting with purchase orders: Fixed receipt price profit Fixed receipt price loss Fixed receipt price offset
Use these accounts when purchasing items if Fixed receipt price is selected for the Inventory model group and the purchase price differs from the standard cost price listed in the Item table.
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Inventory Tab
The Inventory tab shows the accounts that are used for inventory-related posting for the item group.
FIGURE 2.4 ITEM GROUP FORM - INVENTORY TAB
The Inventory tab contains the following field groups: Inventory Inter-unit offset Fixed receipt price Fixed assets Variance
Inventory Tab - Inventory Field Group

The Inventory field group contains the following posting accounts that are used for Inventory journal posting: Receipt and Issue - Use Receipt and Issue to post item receipts and item issues in the inventory journals. Profit and Loss - Use Profit and Loss to post item profit and item loss in the inventory journals. When you use counting journals, the account number must be specified for the inventory schedule to be posted.
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Inventory Tab - Inter-unit Offset
The Inter-unit payable and Inter-unit receivable accounts are used to post profit or loss incurred when you transfer between item dimensions within the same site, and between sites. Profit or loss can occur when different item dimensions have different costs, or if different sites have different costs for the same item.
Inventory Tab - Fixed Receipt Price

The Fixed receipt price field group contains the following posting accounts that are used for posting inventory: Fixed receipt price profit - Account for posting gained difference in relation to fixed receipt price. Fixed receipt price loss - Account for posting lost difference in relation to fixed receipt price.
Inventory Tab - Fixed Assets and Variances Field Groups

In the Fixed asset issue field, enter the account number to use when you issue items in this group. This account is updated when the asset acquisition is posted, either through invoice posting or an acquisition proposal. The Rounding variance field is where you set up the account for posting standard cost rounding variances.
Production Tab
The Production tab shows the accounts that are used for production-related posting for the item group.
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For production orders, transactions are generated for both the component raw materials, and the produced bill of materials.
FIGURE 2.5 ITEM GROUP FORM - PRODUCTION TAB
The Production tab contains the following field groups: Items in process Costing
Production Tab - Items in Process Field Group

The Items in process field group contains the following posting accounts that are used for process posting in Production: Picking list and Picking list offset account - When a production order is started, or physical item consumption is registered for the production order, issue transactions for the component items are created, and item consumption is posted in Picking list, Issue account, and Picking list offset account. The cost price of the raw materials is calculated according to standard rules for issues. Report as finished and Reported as finished offset account When production orders are reported as finished, receipt transactions are generated for finished items, and the items calculated cost price is posted in Reported as finished (receipt account), and Reported as finished offset account.
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Production Tab - Costing Field Group
The Costing field group contains the following posting types with regard to costing and production: Issue and Issue offset account - When you cost account production orders with End date of job selected, the four accounts that were mentioned earlier are reset and the actual consumption of raw materials is credited to Issue and debited from Issue offset account. Receipt and Receipt offset account - The cost price of the finished item is debited from Receipt and credited to Receipt offset account. When the standard cost price is used for the finished item, these transactions are made at standard cost price.
Setup Tab
The Forecast field group contains the following account: Default item allocation key - Select the user-defined allocation key to serve as the proposed standard key when you create forecasts for the item group. Item allocation keys are created in the Item allocation keys setup of the Master planning module.
FIGURE 2.6 ITEM GROUP FORM - SETUP TAB
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Item Group Buttons
The following buttons are available in the Item group form: Posting - Click the Posting button to view the Inventory posting form on the selected item group. Forecasting - Click the Forecasting button to access the Sales, Purchase, or Inventory forecast forms on the selected Item group.
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Lab 2.1 - Locating Inventory Posting Accounts

Contoso Entertainment Systems - Company CEU Scenario You are the new accounting clerk for Contoso Entertainment Systems. You have been asked by your manager to determine, in Microsoft Dynamics AX 2009, the tabs and field names on which the posting account numbers must be entered. Determine the following: Costs associated with a sales order at the point of packing slip update. The commission paid to a salesperson after a sale has been completed. Discounts granted on sales orders. Costs associated with a purchase order at the point of packing slip update. The variance in the amount an item was sold for compared to the cost of the item at the time that it was returned.
Challenge Yourself!
In Microsoft Dynamics AX 2009, locate the information described in the scenario.
Need a Little Help?

Posting account numbers are defined in Inventory management > Setup > Item groups. Sales posting accounts are defined on the Sales order tab. Purchase posting accounts are defined on the Purchase order tab.
Step by Step
1. From the Navigation pane, click Inventory management >Setup > Item groups. 2. Click the Sales order tab and note the content of the Packing slip field. 3. Also, on the Sales order tab, note the content of the Commission offset field. 4. Also, on the Sales order tab and note the content of the Discount field.
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5. Click the Purchase order tab and note the content of the Packing slip field. 6. Click the Sales order tab, and note the content of the Consumption field. 7. Close the Item group form.
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Inventory Model Groups

Inventory management > Setup > Inventory > Inventory model groups Inventory model groups are an important part of calculating inventory values and determining how the item is posted to the General ledger. Inventory model groups contain settings that determine how items are controlled and handled upon item receipt and issue. Inventory model groups help determine: The calculation of cost prices and item consumption. If physical and financial negative inventory is permitted. If inventory transactions are to be posted to the General Ledger. The workflow used when you send or receive items. The reservation rules, when you create sales order lines for items where some or all of the quantity of the item has the status Ordered.
The setup of an item's inventory model group is important when you determine how the item will integrate with other areas of the Microsoft Dynamics AX 2009 system. Not all fields are covered in this lesson as they apply to other areas of the system which will be covered in other Trade and Logistics courses.
FIGURE 2.7 INVENTORY MODEL GROUPS FORM
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Inventory Model Tab
Inventory is closed and recalculated according to the rules of the selected Inventory model. The choices are: FIFO LIFO LIFO date Weighted Average Weighted Average date Standard Cost
Learn more about Inventory models in the Microsoft Dynamics AX 2009 Inventory Costing and Valuation course.
Setup Tab
The Setup tab of the Inventory model groups form has five field groups. Negative inventory Warehouse management Ledger integration Physical update Reservation
FIGURE 2.8 INVENTORY MODEL GROUPS FORM - SETUP TAB
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Setup Tab - Warehouse Management Field Group
The Warehouse management field group is where you set up and maintain parameters for the selected inventory model group's warehouse management. It contains two parameters: Quarantine management Consolidated picking method
Quarantine Management Select the Quarantine management check box to indicate that items attached to this group are under quarantine management rules and requirements. This is used for items set aside that are waiting for approval for reception into the physical inventory. If the check box is clear, items will not be under quarantine management unless a quarantine order is created manually in Quarantine orders. When the item is registered, a quarantine order is generated with the status of Started. Consolidated Picking Method With the Consolidated picking method check box you can pick multiple orders and use picking areas and shipment functionality.
Setup Tab - Negative Inventory Field Group

The Negative inventory field group determines whether Physical or Financial negative inventory will be permitted. It contains the following two parameters: Physical negative inventory Financial negative inventory
Setup Tab - Physical Negative Inventory

Select the Physical negative inventory check box to help you sell an item even though you have no stock. This parameter is sensitive for inventory value calculation. The decision whether to select or clear this parameter must be taken with the utmost care to prevent incorrect use of the functionality.
EXAMPLE: There is usually a time lag between arrival of items in the warehouse and when the purchasing department updates the received item's packing slips. When visiting the warehouse, you can notice that the items have arrived for your purchase order, even though it is not a part of your warehouse in the system. If the item's inventory model group has Physical negative inventory selected, you can deliver the item even though it has not yet been registered as being physically present in the inventory.
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Setup Tab - Financial Negative Inventory
When the Financial negative inventory check box is clear, you are prohibited from selling stock, although physically available, if there is no financially updated on-hand inventory for the item. Depending on how the system is used, this typically means that an invoice must first be posted before selling stock is permitted. When this field is selected, negative financial inventory is enabled and the user can sell items without knowing the real cost price. The invoice of these items might be posted after the items are sold and then an inventory closing has to adjust the cost prices to the real cost prices. This setting is frequently used for services.
NOTE: If the Financial negative inventory check box is selected, you should also enter a cost price on the item. Otherwise, your temporary average cost price on sales order line/production line will be zero until the closing/recalculation of the inventory finally settles the issue. Enter the cost price in the Cost price field on the Price/Discount tab in the Items form. If you select Use combination cost price in the Items form, the system will enter the cost price in the Cost price tab in the Combinations of item dimensions form. To find this form from the item, click Setup > Combination of item dimensions.
Examples - Financial Negative Inventory

The following two examples show situations where you select the Financial negative inventory parameter for the inventory group attached to an item: Example 1 There is a vendor that you frequently deal with. They invoice you, without fail, one week after you have received delivery of the goods and notified them of the delivery. You attach all items from this vendor to an inventory model group that enables negative financial inventory because, although you have not financially updated the purchase, you will be doing this within the next seven days. Therefore, you can sell items that belong to this inventory model group immediately on reception and physical update, safe in the knowledge that the financial updating of transactions will occur within the next few days, creating minimum financial irregularity between the financial receipt and issuing of the items. Example 2 In the item's inventory model group select the Financial negative inventory check box if you have to send the invoice to another department for verification but still want to be able to sell the item while you wait for final approval.
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Setup Tab - Ledger Integration Field Group
The Ledger integration field group determines whether inventory transactions are to be posted to the General ledger physically or financially and when they must be posted. The fields in this group are as follows: Post physical inventory Post financial inventory Post physical revenue Post physical purchase
Setup Tab - Post Physical Inventory

The following table explains the effect of the Post physical inventory parameter when it is selected or cleared. Selection status Selected Implication If this field is selected, physical item transactions are posted in the ledger if: The Post packing slip in ledger parameter is selected in the Accounts receivable and/or Accounts payable Parameters form. You are working with Bills of Material and the Post report as finished in ledger is selected in Production Orders Parameters.
NOTE: If you select this parameter, packing lists from purchases or sales are posted at cost price in the ledger. This means that the value of physically received, delivered, or floating items is not only reflected in the inventory, but also in the ledger. When the same purchase or sales invoice is updated, the transactions are reversed from the packing slip update. Clear The Post Packing Slip in Ledger and Post report as Finished in Ledger updates are not posted in the ledger, regardless of the setup selected in the Purchase, Sales, and/or Production order parameters.
Setup Tab - Post Financial Inventory

The following table explains the effect of the Post financial inventory parameter when it is selected or cleared: Selection status Selected Implication If this field is selected, the updated financial value of items is posted in the ledger: When a purchase order is invoice-updated, the value of the items is posted to the inventory receipt account. When a sales order is invoice-updated, the value of the items is posted to the inventory issue and consumption accounts.
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Selection status Clear
Implication Purchases are posted to the item consumption account when the purchase is invoice-updated. No posting occurs in the inventory receipt account when purchases are invoice-updated. Similarly, no posting occurs in the item consumption account or the issue account when sales orders are invoice-updated. Additionally, when the check box is clear, records in the Movement and Profit/Loss Inventory journals will not generate ledger postings.
Setup Tab - Post Physical Revenue and Post Physical Purchase

Select the Post physical revenue parameter to post the expected revenue or turnover, with regard to updating the packing slip, in the General ledger module. Balance can figure both a realized and an expected contribution margin. This is typically used when a company recognizes revenue at the time of shipment instead of at the time of invoicing a customer. When the order is invoiced, the transactions are reversed from the packing slip. Select the Post physical purchase parameter to post the estimated purchase for packing slip updates to the General ledger.
Setup Tab - Physical Update Field Group

The fields in the Physical update field group determine the workflow used when you send or receive items and you use them to set rules around how an order is handled, both for receiving and shipping. The Physical update field group contains the following four parameters: Registration requirements Receiving requirements Picking requirements Deduction requirements
Setup Tab - Registration Requirements

By selecting the Registration requirements check box, the user must register the receipt before inventory is updated through the packing slip on a purchase order. Register an item to record the item's physical presence at the company. However, the items are not yet part of the company's warehouse until they are physically updated with a packing slip update. Generally, this option is used with the Warehouse management functionality.
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EXAMPLE: Select the Registration requirement parameter to monitor the vendor performance or the reception of goods into the company. In this case, you must monitor the goods as soon as they arrive at the company.
Setup Tab - Receiving Requirements

When the Receiving requirements parameter is selected, item receipts must be physically updated before they can be financially updated. A packing slip must be entered and posted before the corresponding vendor invoice can be posted. If there is a difference between the received quantity on the packing slip and the invoiced quantity on the invoice, an icon is shown in the Packing slip quantity match column in the Posting invoice form. Setup Tab - Picking Requirements and Deduction Requirements When you select the Picking requirements parameter, item issues must have the status of Picked before inventory is physically updated. The item issue inventory transactions must have the status of Picked before the packing slip can be updated.
NOTE: Select the Picking requirements parameter with the warehouse management functionality when you use location management on the item and when shipments are collected by using picking routes.
When you select the Deduction requirements parameter, item deductions must be physically updated before they can be financially updated. A packing slip must be entered and posted before the corresponding vendor invoice can be posted. If there is a difference between the deducted quantity on the packing slip and the negative invoiced quantity on the invoice, an icon is shown in the Packing slip quantity match column in the Posting invoice form.
Setup Tab - Reservation Field Group

The Reservation field group contains two parameters: Date-controlled Backward from ship date
When selecting these parameters for the inventory model group you determine how Microsoft Dynamics AX 2009 makes reservations of the type Automatic, where no on-hand inventory or receipts with the status Received or Invoiced exists for the item but there are receipts with the status Ordered for the item. Additionally, for these parameters to come into effect, the Reserve ordered items parameter must be selected in Inventory management > Setup > Parameters > General tab.
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Setup Tab - Reservation Field Group Definitions
The following table explains the Reservation field group parameters. Parameter Date-controlled and Backward from ship date (clear) Effect Sales order lines are reserved against the purchase order line with the lowest dimension number. For example, there are three receipts with the status of Ordered with batch numbers AA_0001, AA_0002 and AA_0003. As AA_0001 is the batch with the lowest alphanumeric identifier and is the batch that is reserved against for a sales order line. Select Date-controlled and the lot with the earliest delivery date before the issue is selected to fulfill the issue, inventory is therefore handled according to a FIFO principle. Select Backward from ship date and the purchase order line with the closest ship date before the issue is reserved for the sales order line.
Date-controlled (selected)
Backward from ship date (selected)
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Lab 2.2 - Set Up an Inventory Model Group and Apply It to an Item

Contoso Entertainment Systems - Company CEU Scenario You have been asked to create an Inventory model group for an item Lab DVD Player that your company will sell within the month. As soon as you have created the inventory model group, create the new item, and attach it to that inventory model group. You will also perform some purchase order and sales order transactions to explore how the inventory model group affects the behavior of the item when you create transactions.
Challenge Yourself!
1. Create the Inventory model group IMG.DVD. It must have the following features: You can only sell quantities of the item that are fully financially updated. Ensure that physical updates (packing slip updates) for the sales order are posted in the ledger. Items must be registered on receipt and picked on issue. Accept the default settings for the inventory model group The item must have the specifications outlined in the following table: Setting Item number Item name Item group Inventory model group Dimension group Value 170320 Lab DVD Player DVD Player IMG.DVD N-W
STOP HERE: The remaining steps in this lab, Challenge Yourself - Part 2, require skills you will gain after completing the Trade and Logistics I course. The rest of the lab is therefore a demonstration. The reason for the additional steps in the lab is to show the effect of parameter settings in inventory model groups when you create item transactions and posting updating. You may want to revisit this lab later, at which stage you can execute all the steps in the lab.
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1. Create a purchase order with vendor 1203 for ten pieces of item 170320 to be received at site 2, and warehouse 21. 2. Perform all the necessary stages to packing slip update the purchase order. Do not invoice update the purchase order yet. 3. Create a sales order for customer 2021, for five pieces of item 170320 from site 2, and warehouse 21. 4. Perform all the steps that are required to packing slip update the sales order. 5. From the sales order line click Inventory > Transactions > Ledger tab. Investigate if any posting has occurred in the ledger after the packing slip update. 6. Try to financially update the sales order. 7. Consider the following: o The reason(s) why the sales order cannot be invoice updated? o The steps you must take to invoice update the sales order? 8. Take the steps that are required to financially update the purchase order and sales order.
Need a Little Help?

1. Click Inventory management > Setup > Inventory > Inventory model groups to create the Inventory model group as specified in the scenario. 2. Refer to the definitions of the various inventory model group parameters.
Step by Step
Challenge Yourself - Part 1 1. Click Inventory management > Setup > Inventory > Inventory model groups. 2. Press CTRL+N to create a new Inventory model group. 3. Type IMG.DVD in the Inventory model group field and the Name field.. 4. Click the Inventory model tab. 5. Ensure that FIFO is selected as the Inventory model. 6. Clear the Financial negative inventory field on the Setup tab. 7. Ensure that the Post physical inventory and Post Financial inventory fields are selected. 8. Select the Registration requirements check box. 9. Select the Picking requirements check box. 10. Close the Inventory model groups form. 11. Click Inventory management > Item details
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12. 13. 14. 15. 16. 17. Click CTRL+N to create a new item. Type 170320 in the Item number field. Type Lab DVD Player in the Item name field. Click the arrow in the Item group field, and select DVD Player Click the General tab. Click the arrow in the Inventory model group field, and select IMG.DVD. 18. Click the arrow in the Dimension group field, and select N-W. 19. Close the Items form.
Challenge Yourself - Part 2 1. Create the first purchase order as specified in the lab description. 2. Register the items arrival by clicking Inventory > Registration and then selecting the Auto-create check box to register the arrival of the item and then click Post all to complete the registration. 3. Click Posting > Packing slip and in the Quantity field select All. 4. Enter a number in the Packing slip field and then click OK 5. Create a sales order with customer 2021 for five pieces of Lab DVD Player from site 2, and warehouse 21. 6. Pick the quantity of the item from the line, according to the specification of the inventory model group, by clicking Inventory > Pick and then selecting the Auto-create check box and then clicking Post all. 7. Packing slip update the sales order by clicking Posting and selecting the sub-menu item Packing slip. In the Quantity field, select All and then click OK. 8. From the sales order line click Inventory > Transactions > Ledger tab. You will see the amount that has been posted to the packing slip account and the Packing slip account number is visible (check the Item group for DVD Player to cross reference this account number). 9. Try to invoice update the sales order by clicking Posting > Invoice and in the Quantity field selecting All. You cannot invoice update the sales order until a quantity of the purchase order receipt has been financially updated. This occurs because the Negative financial inventory parameter is clear for the items inventory model group. You can invoice update the sales order as soon as sufficient financially received on-hand inventory exists for the item. You must therefore invoice update the purchase order before you can invoice update the sales order.
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Dimension Groups
Inventory dimensions are used to define the physical characteristics of inventory items. They control how items are stored and drawn from inventory and enable inventory to be managed on a detailed level. Inventory dimensions are split into item dimensions and storage dimensions. The dimension group is a mandatory field in the Items form. However, if only a few dimension groups are used, include the dimension group in the item templates used when you create new items. In this manner, the dimension group does not have to be selected manually for each item being created.
Setting Up Dimension Groups

Inventory dimensions are used to: Determine the physical characteristics of an item Determine how items are stored in inventory Track inventory transactions View on-hand inventory for each dimension Link issues to receipts by using marking
The two types of inventory dimensions are: Item Dimensions Storage Dimensions
NOTE: There are no set guidelines for selecting dimensions. However, you should only use the number of dimensions that will actually be used for each item. If some items are tracked, and other items are not, create several dimension groups. Carefully consider how inventory must function before setting up inventory dimensions and dimension groups. As soon as you have created transactions for an item attached to a dimension group you cannot make any additional changes to the dimension group.
Item Dimensions
An item dimension is used to determine item attributes, for example configuration, size, and color. The following table shows the item dimensions that are available. Dimension Size Color Definition Size characteristic of an item. Example: PB-Frame 10, 12, and 15. Color characteristic of an item. Example: PB-Paint Black, Blue, and Chrome
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Dimension Configuration
Definition A third identifying characteristic of an inventory item. Example: Product model
The following rules apply to item dimensions: The dimension must be specified when you create item transactions, for example, when a purchase or sales order line is created. The specified dimension applies only to the item transaction. You can neither fully nor partly change the dimension value for the related inventory transactions upon physical issue or receipt. Items are always reserved for each dimension. You cannot reserve items for dimension values other than those specified on the actual item transaction.
Procedure: Create Item Dimensions and Specify Default Dimensions

To specify specific item dimensions for a particular item, for example, a range of colors or sizes: 1. Ensure that the dimension group attached to the item has the parameters for dimensions you want to specify for the item, in this case color, size or configuration. 2. Click Setup > Color/Size/Configuration. 3. In the Color form, specify the colors you want to associate with the items. Each time that you create a purchase order or sales order you can specify the item dimension value on the line. You can also set up default item dimension values for the dimensions Color and Size that are automatically proposed every time that you create, for example, a purchase or sales order line for the item.
Scenario: Setting Up Default Item Dimensions

Contoso Entertainment Systems has been selling CRT Television model 02 for several years. The most popular model is the black model with a screen size of 17 inches. This accounts for 80 percent of the orders of the item. To save work configuring the item to this popular combination of size and color, the sales manager has set this size and color up as the default item dimensions for the item. Therefore, every time that a sales order line is created for CRT Television model 02 these dimension values are automatically proposed.
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Procedure: Set Up Default Item Dimension Values
To set up the default item dimension values for an item: 1. Click Inventory management > Item details. 2. Select the item for which you want to set up the default item dimensions. 3. Click the General tab and in the Size and Color fields; specify the size and colors you want to automatically use on order lines for the item.
Storage Dimensions
A storage dimension is used to determine where and how an item is stored. The following table shows the storage dimensions that are available. Dimension Warehouse Site Batch number Location Definition Storage location, such as a building. Site in a multisite enabled company. ID for a group of related items like a container, pallet, or box of the same items. Detailed item storage location, such as aisle-rack-shelf-bin. Typically, use this dimension when you operate with Warehouse management. ID for a group of items on the same pallet. Only used when operating with Warehouse management. Unique or non-unique ID for each item.
Pallet ID Serial number
Dimension Groups and Items - Creation Guidelines

Each item must have an associated inventory dimension group. The dimension group determines the relevant dimensions and how and when they are used. Although it is difficult to define a standard inventory dimension setup, there are some basic principles to be aware of when you set up inventory dimensions: Determine if the dimensions are relevant for the business. Consider the relevance of each dimension for the various groups of items before setting up dimension groups. Only set up the number of dimensions that will actually be used for each item. If some items are tracked, and other items are not, create several dimension groups.
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The Inventory Dimensions Form

Inventory management > Setup > Dimensions > Dimension groups The Inventory dimensions form is split into three panels: Dimension group ID Item dimensions Storage dimensions
FIGURE 2.9 INVENTORY DIMENSIONS FORM
The Dimension group ID panel provides an overview of all dimension groups set up in the system. You can add as many new inventory dimension groups as you need. Item dimensions can be activated and set up in the Item dimensions panel. Storage dimensions can be activated and set up on the Storage dimensions panel.
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Inventory Dimensions - Active
If the Active parameter is selected, the dimension is enabled for any items associated with the dimension group. Example: The dimension group is for items sold in different colors. Therefore, the dimension Color is selected as Active.
Inventory Dimensions - Primary Stocking

If the Primary stocking parameter is selected, it is mandatory that the dimension be entered before any physical updates. If cleared, this dimension is considered secondary stocking. Primary stocking is also important with regard to how inventory is re-reserved. Example: An item requires full forward-backward traceability. This item will have Batch selected as Primary stocking.
Inventory Dimensions - Blank Receipt Allowed

If the Blank receipt allowed parameter is selected, Microsoft Dynamics AX 2009 accepts a blank value for the dimension at the physical update of a receipt.
NOTE: If you select the Primary stocking parameter for this dimension the Blank receipt allowed parameter is automatically cleared.
Examples: 1. The Contoso Entertainment Systems purchases high value projector lamps from a vendor. Although these lamps are delivered with a serial number the company does not register these when they receive items. However, ensure that the items have a serial number attached to them on issue. Therefore, the dimension group attached to this must allow blank receipts for serial numbers but will not allow blank issues for items attached to the dimension group when the items are sold or when items are consumed in a production order. 2. You might select Blank receipt allowed with collectors items. It might not be important for the distribution company to register a serial number upon receipt of items. However, it is important for the customer that they have an item with the specificity of a serial number.
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Inventory Dimensions - Blank Issue Allowed
If the Blank issue allowed parameter is selected, Microsoft Dynamics AX 2009 accepts a blank value for the dimension at the physical update of an issue.
NOTE: If you select the Primary stocking parameter for this dimension the Blank issue allowed parameter is automatically cleared.
Inventory Dimensions - Physical Inventory

If the Physical inventory parameter is selected the dimension is to be included in the physical inventory. Microsoft Dynamics AX 2009 checks the physical onhand level based on the dimension value when the packing slip is created for issued items. If the Physical inventory parameter is clear, the dimension is not considered when you make an issue for an item with the dimension group attached. Example - Physical Inventory Selected Thirty pieces of on-hand inventory for an item attached to the dimension group are distributed between: Warehouse GW = 20 pieces Warehouse MW=10 pieces
Then you sell 30 pieces of the item from warehouse GW and now only 20 pieces are available at GW. Because the dimension setup requires that physical inventory be considered, even though there are an additional ten pieces at warehouse MW, an error is generated. Example - Physical Inventory Cleared Your warehouses are close to one another, or the cost of transferring the goods to the dispatch location is low. Therefore, you do not have to be precise about where the items are issued from if insufficient on-hand inventory exists at one warehouse location the remaining necessary on-hand inventory can easily be obtained from another location.
Inventory Dimensions - Financial Inventory

Select the Financial inventory parameter if the dimension is to be included in calculating the financial cost of an item sold. This flag ensures that you can control and track different cost prices for an item for the storage dimension, such as different prices in different warehouses, or for other types of dimensions. If the Financial inventory parameter is cleared, the average cost of the item is distributed across all dimensions concerned.
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Example - Financial Inventory Selected With the storage dimension, storage space in New York City is much more costly than warehouse space in Lisbon, Portugal. You have to account for the different costs of storage in calculating the cost of the item. Selecting this dimension enables you to track these costs.
Inventory Dimensions - Coverage Plan

Select the Coverage plan parameter if this dimension is to be included in coverage plans created through master planning. Selection lets you define criteria such as minimum/maximum, lead times and coverage groups for each dimension. Example: Many companies select to run master planning by warehouse. However, in some cases, it helps to run MRP based on a finer level of detail. This frequently occurs in companies that have slow moving or costly inventory. By selecting this check box, MRP will be calculated at the finest level of detail.
Inventory Dimensions - Use in Price Search

In addition to the parameters that you can specify on the Overview tab, on the General tab you can specify settings for the Use in price search parameters.
FIGURE 2.10 INVENTORY DIMENSIONS FORM - GENERAL TAB
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The following table describes the options in the Use in price search field group. Field Purchase prices Sales prices Function Description If selected, you can specify a purchase price or discount for this dimension through trade agreements. If selected, you can specify a sale price or discount for this dimension through trade agreements.
In the Use in price search field group, the option of sales and or purchase price trade agreements can be enabled. If you have to set up a trade agreement or discount for a particular dimension, you can enable it here.
Demonstration: Use Price Search

This demonstration shows how to set up the dimension Color that is used in purchase price search. 1. Create a new dimension group named Created, with Color as an active item dimension and select the For purchase prices check box. 2. Create a new item 170210. Name the item Purchase price test and use Item group DVR. 3. Specify the new dimension group Created on the item. Specify the Inventory group FIFO. 4. Specify that the item is available in two colors; black and silver. 5. From the new item open Trade Agrmt. > Purchase prices. 6. In the Price (purch) form create one purchase price agreement with vendor 1201. o Create a purchase price agreement for the color dimension black for a price of 15.00 USD for each piece by selecting the color black and entering 1 in the Quantity field and 15.00 in the Price field. o Create a purchase price agreement without specifying a color item dimension for 10.00 USD for each piece by entering 1 in the quantity field and 10 in the Price field. 7. Create a purchase order for vendor 1201. Create two lines with the new item: one with color black specified, and one with color silver specified. 8. As the For purchase prices parameter is active, the line with color black specified on it has the price 15.00 USD whereas the other line receives the standard price undifferentiated by color of 10.00 USD.
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Inventory Dimensions - Serial Number Control
If the Serial number control parameter is selected, there must be one serial number for each item. If the parameter is cleared, a serial number is non-unique and can be assigned to more than one item. Example: You offer a warranty for all items. Therefore, it is important for traceability purposes that you have a unique serial number for each item you sell.
Inventory Dimensions - Editing Tab

The editing functionality under the Editing tab lets you change and specify the dimension when you create sales lines, purchase lines, inventory transactions and the other categories of transactions shown in the Allow entry field group.
FIGURE 2.11 INVENTORY DIMENSIONS FORM - EDITING TAB
When the Allow entry parameter is selected for a dimension, you have the option of changing the dimension when a new order is created. If it is cleared, you cannot edit the dimension.
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Scenario: Set Up Editing Dimensions
Your company wants to tightly control which warehouse receives certain items. For these items in the Purchase warehouse field in the Site specific order settings form, you specify GW, which is the warehouse where the item is received. You also attach a dimension group to the item which does not allow for editing for purchase order lines. In this manner, whenever the purchaser creates a purchase order for this item the purchase order is always received into GW and the inventory dimension value GW cannot be changed to another warehouse.
Item Dimensions: Rename Tab

You can rename the two item dimensions Size and Color to suit the company's requirements.
FIGURE 2.12 INVENTORY DIMENSIONS FORM - RENAME TAB
Notice that the Configuration dimension cannot be renamed.

EXAMPLE: Your company uses the term Model instead of Size to distinguish items. You can rename the size dimension to Model.
NOTE: Dimension rename is global and affects dimensions in all dimension groups, not only the current dimension group.
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Procedure: Rename an Item Dimension
The following procedure shows how to rename an item dimension. 1. Click Inventory management > Setup > Dimensions >Dimension groups > Rename tab. 2. Click Rename. 3. Select the text that you want to rename and overwrite the old text with a new text.
NOTE: If multiple languages are used, the dimension texts must be entered for each language. Renamed text(s) will be lost when you upgrade to a new version of Microsoft Dynamics AX. After confirming the new name(s), you must close all windows before the changes take effect.
Item Dimension Combinations

Inventory management > Setup > Dimensions > Item dimensions > Item dimension combinations Item dimensions are defined separately for each item when they have been enabled through the dimension group. The dimensions are entered in the following tables: Configuration Size Color
These are accessed through Inventory > Setup > Dimensions > Item dimensions or from the Setup button on the Items form.
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An item may have different sizes and colors but you may be unable to purchase and/or sell items in every combination of those dimensions. The available combinations must be created in the Combination of item dimensions form.
FIGURE 2.13 COMBINATIONS OF ITEM DIMENSIONS FORM
The Create Combinations button can help in creating the item dimension combinations for a new item. Combinations can be automatically created or manually added.
Procedure: Create Item Dimension Combinations

To create all dimension combinations automatically, follow these steps: 1. Click Inventory Management > Item details. 2. Select the item for which you want to have item dimension combinations created. 3. Click the General tab. 4. Select Auto create combinations. When you select the Auto create combinations parameter, every time that a new dimension is added, every combination is automatically created.
EXAMPLE: You create an item called Color Bulb, whose dimension group has the item dimensions Color and Size specified for them. Color Bulb is available in pastel and white and in 60 and 100 watt sizes. As you have selected Auto create combinations for the item, four item combinations were automatically created. The Contoso Entertainment Systems decides to sell the bulb in a low wattage 40 watt version. The 40 watt size is added to the size dimension for the item and two more dimension combinations for 40 watt pastel and 40 watt white are automatically created.
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Procedure: Create Combinations Manually
If you do not want all item dimension combinations, create the combinations manually. To create item dimension combinations manually, follow these steps: 1. Create all the item dimensions that you need for the item. 2. Click Inventory management > Item details. 3. Select the item for which you want to create dimension combinations. 4. Click Setup > Item dimension combination. 5. Click Create combinations. 6. Select the Select combination check box to create a combination of item dimensions you can select, for example, from the sale or purchase order line.
Combination Cost Price

Combination cost price lets you use different pricing for different dimensions. For example, a vendor sells t-shirts with the following prices. Cost 3.55 3.55 3.55 2.85 2.85 2.85 3.75 3.75 3.75 Size Small Medium Large Small Medium Large Small Medium Large Color White White White White White White Red Red Red Configuration 100% cotton 100% cotton 100% cotton 80% cotton; 20% polyester 80% cotton; 20% polyester 80% cotton; 20% polyester 100% cotton 100% cotton 100% cotton
If you use Combination cost price, these variations can be defined and then attached to the item, instead of requiring that a new item is set up for each combination. Specify the item cost price for each dimension combination by selecting Use combination cost price on the General tab of the Items form. If this has been selected, the Cost price button on the Combinations of item dimensions form can be accessed and prices edited.
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Procedure: Specify Cost Price for each Item Dimension Combination
To specify a cost price for each item dimension combination, follow these steps: 1. Click Inventory management > Items. 2. Select an item on which there are item dimension combinations. 3. Click Setup > Item dimension combinations and then click the Price button. 4. Enter the cost price information for the specific item dimension combination in the Pending prices tab and then click the Activate button to apply it. If you clear the Use combination cost price parameter, you cannot specify a cost price for each item dimension combination and the cost price for the item is used instead. Additionally, you cannot edit the cost price for each dimension combination.
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Lab 2.3 - Create an Inventory Dimension Group

Contoso Entertainment Systems - Company CEU
NOTE: At the end of this lab, please rename the Dimension that you change back to Color.
Scenario You plan to launch a new range of travel projectors and must create a dimension group to attach the new items in the line. The travel projectors are available in many sizes and finishes. The term Finish is used in your company instead of the word Color. Additionally, it has been decided that you want to track sales of these new travel projectors by site. The specification for the dimension group is as follows: Dimension group ID must be TP Name must be Travel Projectors
The inventory dimensions Size and Finish must be active and have Primary stocking selected (you must rename the dimension Color to Finish). The dimension Site must have the following properties: It must be included in the physical inventory The site dimension must be included in calculating the financial cost of the items sold
Challenge Yourself!
1. Create an inventory dimension group for the new line of travel projector you are introducing into the market. Use the specifications from the scenario. 2. The dimension Site must be active and have Primary stocking selected.
Need a Little Help?

1. Click Inventory management > Setup > Dimensions > Dimension groups to create an inventory dimension group for the new line of travel projectors that you are introducing into the market. Use the specifications from the scenario. 2. To rename the dimension Color to Finish, look back to the procedure associated with renaming an item dimension. 3. Verify the selection status of the Physical inventory and Financial inventory parameters.
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Step by Step
1. Click Inventory management > Setup > Dimensions > Dimension groups. 2. Press CTRL+N to create a new dimension group. 3. Select the dimension Color. 4. Click the Rename tab. 5. Click Rename and overwrite the text for Color with Finish. 6. For the dimensions Finish and Size click the Active and Primary stocking parameters. 7. For the Warehouse dimension ensure that the dimension group has the parameters Active, Primary stocking, Financial inventory and Physical inventory.
IMPORTANT: Rename the dimension that you changed to Finish, back to Color. This is to ensure that future labs in Trade and Logistics I will perform succesfully.
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Inventory Parameters
Inventory management > Setup > Parameters Parameters in the Inventory management module are used to select between two or more important types of functionality. In the Parameters form, you can enter default information that must be used by Microsoft Dynamics AX 2009 if it has not been specified at a lower level, and select number sequences for the Inventory management module. The primary setup that must be completed in this lesson is the default Unit field. This is found under Inventory management > Setup > Parameters, General tab. The unit setup specified here will be the default unit of measure used when a new item is created in the Items form. For example, if the default is set to Pcs. (pieces), when you create a new item, the Unit of Measure value is Pcs. The Unit of measure can be changed or overwritten at the time that the item is created.
FIGURE 2.14 INVENTORY PARAMETERS FORM
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Item Setup
Item Setup introduces how to create an item in the Items form and describes how applying settings to the item affects how transactions are created for the item. Use the Items form to create and manage base data for goods, bills of materials (BOMs), and services. You must at least specify: An item number An item group An inventory model group A dimension group
Additionally, you can specify relations to: Purchase Sale Warehouse management Production Master planning Projects Human resources
NOTE: Making changes to the item's base data in the Items form does not automatically change base data in other modules.
Items without inventory transactions can be deleted and item numbers can be changed.
Procedure: Create a New Item by Using Templates

To create a new item, follow this procedure: 1. Click Inventory management > Item details. 2. Press CTRL+N to create a new item. The Select a template for Item table dialog box appears. 3. Select the template on which to base the new item by selecting the check box next to the template. If you want to create the item from scratch, select the Blank template.
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4. Click OK. The default values of the template you selected are copied to the new item. Or, if you do not use a template to create an item, you must as a minimum enter values in the mandatory fields, those fields for which there is a red wavy line. 5. Enter settings for the item which are explained in the following topics and in other courses in the Trade and Logistics collection.
NOTE: When you press CTRL+N to create a new item, and select to create the new item with a template, you create the new item by using the default values of the selected template without the system prompting you. Select the Don't ask again check box in the Select a template for Item table dialog box if you do not want to see the templates list.
Items Form
The Items Form topic provides an overview of settings in the Items form. Not every field is documented here, as many of the fields are dealt with: In other topics in the Inventory course Elsewhere in the Trade and Logistics course In training manuals related to other functional areas of Microsoft Dynamics AX 2009 such as Production, Warehouse Management and other application related courses
Therefore, only the settings that do not fall into any of the categories in the list are described here. The following pages provide a tab-by-tab overview of the Items form.
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Items Form: Overview tab
Inventory management > Item details > Overview tab On the Overview tab you can view all items in the system.
FIGURE 2.15 ITEMS FORM - OVERVIEW TAB
You can specify values in the following fields: Item number Item name Item type
Item Number The item number can be set up to be automatically generated or you can specify the item number manually. This function is controlled by the number sequence in Inventory management > Setup > Parameters.
Items Form: Item Name

Item name is not a required field. This is because Microsoft Dynamics AX 2009 uses the Item number as the primary key/ID to uniquely determine the item. Therefore, the name is only an option in Microsoft Dynamics AX 2009. Item descriptions are written in different languages and printed on external documents or forms. Specify item names by clicking Setup > Language - Item description and entering the description under the selected language. The customer's and vendor's language codes determine which text is retrieved in Accounts receivable, and Accounts payable, respectively.
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EXAMPLE: You specify that the item name for item B-Pack-1 must appear as Batterier in Danish. You sell 100 units of B-Pack-1 to a one-time customer in Denmark and in the Create sales order form, specify that the language must be Danish. When you print the confirmation for the order, the item name is printed in the Danish translated form Batterier.
Although the Item name field is optional, if completed, the content is copied to the Search name field. In the Search name field, you can overwrite the copied content to enter a name to use for a fast search. For example, use this field if a long item name was entered.
HINT: Searches are faster when done on Search names instead of Item names because they are indexed.
Items Form: Item Type

An item number can be one of three types, as shown in the following table: Item Type Item BOM Description The item type consists of purchased items that do not require processing to be sold or used in a production. With items of type BOM, you can attach routes and a bill of material. The BOM can consist of other item numbers of all types. You can create an item number produced or composed of several item numbers by using the type BOM. If you change the item type to BOM, you can insert BOM lines. When the item type is changed from BOM to Service or Item, the BOM lines button disappears. This can be used for hourly service (for example). Items of this kind do not have a physical on-hand inventory.
Service
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Items Form: General Tab
Inventory management > Item details > General tab On the General tab, you specify group settings related to the selected item.
FIGURE 2.16 ITEMS FORM GENERAL TAB
In the Text field, enter a description of the item. For example, you can enter a description of the item's features.
Items Form: General Tab - Buyer Group and Packing Group

Buyer Group You can associate employees and items with a Buyer group. When you create a purchase by using item coverage or by estimating production, the buyer group is copied to the purchase header, but only if no buyer group was set up for the vendor. The field is copied to planned orders, shown on reports, and can be used to filter on those reports.
EXAMPLE: Some companies find that using Buyer groups makes inventory and sales management, and planning simpler because purchasers are frequently assigned to items. When you attach a Buyer group to an item, one buyer can be made responsible for managing the inventory and sales of that item. Then, sales of that item can be tracked.
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Packing Group Select the packaging group to associate with the item. Packaging groups are used with packaging material and packaging material fees and are specified in the Packing groups form.
Items Form: Setup Tab

Inventory management > Items > Setup tab On the Setup tab, specify price update and item physical dimension settings.
FIGURE 2.17 ITEMS FORM - SETUP TAB
The following table describes some fields on the Setup tab. Field Volume Description This displays the volume for one unit of the item in inventory units. This information is used as shipping information where the item's volume is indicated, such as on packing slips. This displays the amount in inventory units on which to calculate packing duty.
Packing Quantity
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Field Net Weight
Description This displays the net weight in the selected inventory unit. This information is used for printed records, such as packing slips, on which the item's weight is given as shipping information. If the item is of the type BOM, the net weight can be calculated as the sum of the net weight for the items on the bill of material. This displays tare weight of the item for one inventory unit. This displays the gross weight of the item for one inventory unit. This displays the depth of one unit. This includes packaging. This displays the width of one unit. This includes packaging. This displays the height of one unit. This includes packaging.
Tare Weight Gross Weight Gross Depth Gross Width Gross Height
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Items Form: References Tab
Inventory management > Items > References tab This topic will cover the Vendor and the Item sales tax group fields on the References tab.
FIGURE 2.18 ITEMS FORM - REFERENCES TAB
Vendor The Vendor field is where you specify if a main vendor is associated with the item. It is important for item coverage because you use this vendor to create the planned purchase order for the item. The field is also helpful for printing items such as purchase statistics and item lists for each vendor, and for filtering transactions in the Items table.
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Item Sales Tax Group The Item sales tax group field specifies the Item sales tax group. When you create an item, specify the item tax code for the Purchase and Sales groups on the Setup tab. The item sales tax group consists of one or more sales tax codes. Sales tax codes contain information about a tax, such as the percentage, the ledger accounts where posting is to occur, and the name of the tax code. Everything that has anything to do with sales tax is set up and managed through Sales tax.
Items Form: Price/Discount Tab

Inventory management > Items > Price/Discount tab Specify the price settings for the item for purchase order, sales order and inventory in the Price/Discount tab.
FIGURE 2.19 ITEMS FORM - PRICE/DISCOUNT TAB
Price In the Price field, under the Base purchase price, Base cost price, and Base sales price group headings, enter the price for each number of units given in the Price unit field. Price Unit The Price unit field displays the number of units for which the cost applies. If the value is 1 or blank, the cost applies for one unit of the item. If the value is 100, the cost applies for 100 units of the item. When you enter purchase order lines, sales order lines, and inventory journal lines, the unit price is automatically converted for the quantity given on the line. This set up makes sense if the item costs are low.
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Price Misc. Charges A price misc. charge is a fixed additional sum on the price. This is only applied to the Items form, compared to purchase, production, and/or sales. A price misc. charge is a 0-point adjustment of the price. It is an amount added to the price independently of the quantity. It can be for example, production and setup costs, fees, or freight. You can make a price misc. charge dependent of quantity by filling in the Price quantity field and selecting the Incl. in unit price box.
EXAMPLE: A price misc. charge of 80.00 U.S. Dollars (USD) is attached to a sales price of 100.00 USD. When you create an order for the item, the Base sales price, Price field for the order line shows 100.00 USD, and 80.00 USD is added to the balance. When you create an order, all price misc. charges will be scanned.
Price quantity The Price quantity field displays the number that is used when dividing the given price markup for each unit. Date of price The Date of price field displays the date the price was last changed, either manually or, in regard to a purchase or sales order update (for example). Incl. in Unit Price If you select the Incl. in unit price field, the miscellaneous charge will be divided by the number that is specified in the Price quantity field and then added to the price given in Price misc. charges.
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Items Form: Other Tab
Inventory management > Items > Other tab On the Other tab, specify alternative item settings and Intrastat settings for the current item.
FIGURE 2.20 ITEMS FORM - OTHER TAB
Items Form: Other Tab - Alternative Items

The fields in the Item alternative field group are to set up the ability to use alternative items. Select the Use field when you use an alternative item number for the current item. The following table describes the options available in the Use field. Setting Never Description If the order quantity exceeds the quantity of available on-hand inventory, then the alternative item number is not used and orders are registered as backorders. The alternative item is delivered if the quantity of available stock on-hand is less than or equal to 0 (zero). The alternative item number is always delivered, for example, if the current item is replaced by a new item.
Nothing in inventory
Always
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Examples: Alternative Items
If an item number is voided and replaced by a new number, enter the new item number as an alternative item number for the old item. For the old item, the field can be set to Always. If orders are entered for the old item number, the new item number will be delivered. The field can also be set to Nothing in inventory for the old item. This ensures that the new item number is delivered first when levels of the old item are used up and therefore equal 0 (zero). If two or more item numbers cover a single item number, in other words, regardless of the item number that is entered when the sale is made, it will always be a specific item number that is delivered.
NOTE: Alternative item numbers functionality only applies to sales orders. Alternative item functionality is unavailable for Production issues. If you use alternative item numbers, item numbers and texts retrieved from the alternative item are printed on the invoice. The sales statistics are updated for the alternative item number.
Items Form: Other Tab - Alternative Items - Field Descriptions

The remaining fields in the Item alternative field group are described in the following table. Field Alternative Item Number Description Alternative item number used if the value of the field is set to Nothing in inventory or Always, and this is where you select that item that should be the alternative. Specify an alternative configuration associated with the alternative item number and which can be used if the value in the Use field is set to Nothing in inventory or Always. Specify an alternative size associated with the alternative item number and which can be used if the value in the Use field is set to Nothing in inventory or Always. Specify an alternative color associated with the alternative item number and which can be used if the value in the Use field is set to Nothing in inventory or Always.
Configuration
Size
Color
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Items Form: Other Tab - Foreign Trade
The fields in the Foreign trade field group are used to set up parameters that are used in Intrastat reporting within the European community. Commodity: The item's code for Intrastat reporting. Additional Units: Additional Units are used for reporting to Intrastat on trade between countries/regions in the European Union. The field is used when several items are sold under the same Intrastat code. Misc. Charges Pct.: This is a statistic that can be used for Intrastat reporting. Country/region: This displays the item's country/region of origin. This information is used for Intrastat reporting. State: Select the State of origin for the item from the drop-down box.
Items Form: Dimension Tab

Inventory management > Items > Dimension tab In the Dimension fields, you can specify a default Department, Cost center and Purpose for reporting throughout the company.
FIGURE 2.21 ITEMS FORM - DIMENSION TAB
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Default Order Settings

Microsoft Dynamics AX 2009 uses Default order settings when Master Planning generates sales orders, purchase orders, and inventory orders. The main settings involve defining: A warehouse to use for each module when orders are created The settings that modify order quantities for each module when orders are created
There are two versions of the Default settings form. Default order settings form. Use this form to define the default order settings for an item. When you operate in a single-site environment, you can only use this version of the form. Site specific order settings form. Use this form to define settings that differ from the default order settings for an item on a different site. The multisite functionality must be enabled to use this version of the form.
NOTE: When the multisite functionality is enabled, the default warehouse settings are transferred from the General tab of the Default order settings form to the Overview tab of the Site specific order settings form. The default warehouse settings on the General tab of the Default order settings form are replaced by the default site settings.
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General Tab
Inventory Management > Item details > Setup > Default Order Settings > General tab Use the General tab to set up default sites for Purchase, Inventory and Sales.
FIGURE 2.22 DEFAULT ORDER SETTINGS FORM
When multisite is enabled, this tab appears in the Site specific order settings form. You will find fields that have the same names on the Purchase order tab, Sales order tab and Inventory tab of the Default order settings form. This is because they have similar functions that are applied to different forms.
Purchase, Inventory and Sales Unit and Site

This Purchase unit, Inventory unit and Sales unit fields display the stockkeeping unit for purchase, inventory (inventory journals and production), and sales. Items may be purchased in tons, produced in pounds, and sold for each piece.
EXAMPLE: An item can be purchased in tons, produced in kilos, and sold to customers in bags. The item is stocked with an item number, and the conversion factors handle conversion between purchase, production, and sales. With an item number and conversion factors, an item is more manageable in the context of recording, master scheduling and coverage planning.
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The Purchase site, Inventory site and Sales site fields is where you enter the default site for orders that are created for the item. You can change the site unless the Mandatory site check box is selected.
Multiple
On the Purchase order tab, the default quantity in the purchase package, that is the quantity of the item number in stock keeping units, proposed as a default for purchases and requirement calculations, and as a multiple of the purchase quantity. You can always change the default. On the Inventory tab, the Multiple field displays the default quantity in which the item is to be produced. The field refers to the production module, where the information is used in the manufacture of a BOM item. However, you can always change the default quantity. On the Sales order tab, the Multiple field is the number of inventory units in which an item is sold. A value on the order line is always rounded off for the whole sales quantity. If the number of sales units changes, you can indicate a new number.
Min. Order Quantity

The Min. order quantity field specifies the lowest order quantity allowed. The quantity corresponds to the lowest desired number of receipts/issues for the item number. The value is used in purchase, sales, inventory journals, and item coverage. Example: A company receives a discount on an item if it purchases a minimum of ten items. The number ten (10) is entered in the Min. order quantity field of the Purchase order tab of the Default order settings form. Later, whenever a purchase order line is created for the item, ten is the proposed quantity in the Quantity field (on the purchase order line). If you change the quantity to eight, you receive a message that the minimum quantity is ten, and are advised to change the quantity to ten. If you select No, the quantity of eight is kept, despite the settings.
Max. Order Quantity

The Max. order quantity field specifies the largest quantity that is accepted in purchase, sales, inventory journals, and production, for example, the largest quantity for which there is room at the warehouse.
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Example: Delivery is paid for when the purchase is made. Delivery is made by a truck able to carry quantities of thirty five. In this case the Max. Order quantity on the Purchase order tab of the Default order settings form is set to 35, unless you will use multiple trucks. The value 35 is also entered in the Multiple field. If you create a purchase order line with the value of 45, Microsoft Dynamics AX 2009 suggests buying a quantity of 70.
Standard Order Quantity

On the Purchase order tab, you can specify a default quantity used when you create a purchase order line. Specify this value when the item is always purchased in a particular quantity. On the Sales order tab, you can specify the standard quantity for a sales order. That quantity is automatically inserted on the sales order line.
EXAMPLE: For purchase orders, you might want to specify the Standard order quantity as the quantity that qualifies you for a discount with your vendor. In this manner, every time that you create a purchase order with a vendor you will, by default, order a quantity that will entitle you to a discount according to the trade agreement made with the vendor.
Purchase, Inventory and Sales Lead Time

The Purchase lead time, Inventory lead time and Sales lead time fields show the standard delivery-, lead-, or acquisition times for items.
NOTE: If you are using the Delivery date control for sales or transfer orders, the value in the Lead time field on the Sales order tab overrides the value that you specify in Accounts receivable > Setup > Parameters > Sales lead time.
Working Days
Select the Working days check box if days must be specified in open days. Open days exclude, for example, weekends, company shutdowns, public holidays, and other non-open days. Open days are defined in calendars attached to the company, warehouses, work centers, and so on.
Stopped
Select the Stopped check box if the item is blocked. When an item is blocked and you enter a purchase line, a warning message appears. When the item is blocked, inventory transactions that are related to the purchase order line cannot be modified, for example, when you post a packing slip or an invoice.
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You can block a purchased item and concurrently sell it. In this case, the Stopped field is selected in Purchase. However, it is blank in Inventory and Sales. An item number can be blocked for sale, for example, if: The item is still under development or manufacture, and you do not want the item to be sold or reserved. You have received many defective items. The defects must be corrected before the item can be sold. Therefore, you can block the item in the meantime.
You cannot block a series or a lot of the item. If parts of the item are to be blocked, you can block them by moving inventory or by blocking the full stock of the item for that period.
Warehouse and Mandatory

Use the Site specific order settings form when mulitisite is enabled to set up default warehouses. Specify the item's default warehouse or placement for the Purchase order, Inventory, and Sales order field groups. The warehouse is then proposed for item transactions. When you select the Mandatory field, the specified mandatory warehouse will be used for the item for the Purchase order, Inventory, and Sales group. Only inventory transactions at the warehouse specified in Warehouse are accepted.
Units of Measure
In Microsoft Dynamics AX 2009, an item cannot be sold or purchased unless a unit of measure is associated with it. You must specify all units used by a company in the Units form.
Set Up Units of Measure

In the Default order settings form you can specify Units of measure for purchase orders, inventory, and sales orders. For example, an item may be purchased in pounds, stocked in liters, and sold in pints. The following procedures show how to create units of measure and unit conversions.
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Procedure: Set Up Units of Measure and Unit Conversion
To set up units for the company, follow these steps: 1. Click Basic > Setup > Units > Units. 2. Select an existing unit or create a new unit. 3. Specify the number of decimals for the stock-keeping unit to display. You can now continue to specify a unit conversion formula for the unit.
Procedure: Specify a Unit Conversion for the Unit

To set up a unit conversion for the unit, follow these steps: 1. Select the unit from which you want to make the unit conversion. 2. Click Setup > Unit conversion. 3. Press CTRL+N to create a new unit conversion. Create the unit conversion line by using the unit form from which you opened the form. 4. You can specify the conversion with a specific item if it is necessary. This means that the unit conversion is only valid for the selected item. Item specificity is important because, for example, a pack of one type of bulbs might contain five pieces whereas a pack of another type of bulbs may contain ten pieces. Therefore, the unit Pack can be used for different quantities of pieces, dependent on the item. 5. Specify the factor by which the unit must be multiplied to equal the To unit. For example, if there are five pieces in a pack and the Unit conversion form is opened from pieces, enter 5 in the Factor field. 6. In the To unit field, specify the unit to which you want to convert. 7. Specify any additional quantity if you have to specify an additional quantity of the unit on conversion. For example, you create a conversion for one cable roll of RMCable/3 to 200 meters. You specify one meter in the Additional field because when you receive one cable roll, you actually receive 201 meters of sheet metal but one meter in total is scrapped. This is because when you cut the metal into one meter pieces, 0.5 centimeters is scrapped. 8. Click the Example tab to check that the conversion is set up correctly.
Procedure: Set Up Different Language Texts for the Unit

Specify unit texts for the unit so that the customer or vendor's language code will determine which description of the unit is used on the reports.
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To set up different language texts for the unit: 1. Click Basic > Setup > Units > Units. 2. Click Setup > Unit Texts. 3. Select the language and enter the translated text. Whenever you create an order for an item with a unit text for another language specified on it, and the order's language is the same as the language that is used for the unit text, the unit is printed in its translated form.
Unit Creation Wizard

Basic > Setup > Units > Unit conversion Perform an automatic conversion between the units by using the conversion rules specified in the Unit conversion form. Use the item creation wizard to specify a new default unit value and to update the unit conversions between different types of units. If you click the Function button in the Units form, you can use a wizard where Microsoft Dynamics AX 2009 will create general unit conversions for you, such as equating 100cm with 1m.
NOTE: When you perform a conversion, the system first checks whether a specific conversion has been created for the item. If not, the general conversion without item number is used. When a conversion is set up from one unit to the other, you must also create the conversion the opposite way. For example, 1m = 100cm and 1 cm = 0.01m.
Warehouse Management
Inventory management > Setup > Inventory breakdown > Warehouses Warehouse Management discusses how to create a warehouse and attach it to an item.
BEST PRACTICE: If you have enabled the Warehouse dimension in the Inventory dimension group, it is good practice to ensure that the warehouse is always specified by selecting it as Primary stocking.
Procedure: Create a Warehouse

To create a new warehouse: 1. Click Inventory management > Setup > Inventory breakdown > Warehouse. 2. Press CTRL+N to create a new warehouse. 3. On the Overview tab, specify the following information:
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4. Warehouse ID and description 5. Site 6. Warehouse type: o Default o Quarantine - Attach warehouses of the type Quarantine to regular warehouses of the type Default. When you purchase items that are quarantine-controlled to a warehouse, they are automatically put in the warehouse of the type Quarantine that is attached to the receiving warehouse. When you finish the quarantine warehouse the items are then transferred back to the specified receipt warehouse. o Transit - This warehouse type is used for transfer orders and the sales order delivery date control function. Transit warehouses are the system-technical intermediary warehouses between the From and To warehouses, or warehouse and delivery location with the delivery date control functionality.
HINT: You can specify transport times with regard to the selected warehouse by clicking the Transport button. Transport times are used in the delivery date calculation when you use the delivery date control and with transfer orders.
Procedure: Set Up a Warehouse on an Item

To set up a warehouse on an item in a multisite environment, follow these steps: Click Inventory management > Item details. Select the item and then click Setup > Site specific order settings. Select the site for which you are setting up the item. In the Purchase warehouse, Inventory warehouse and Sales warehouse fields, select the warehouse to be proposed as default for the purchase, storage or sale of an item. 5. Select the Mandatory fields and only inventory transactions at the warehouse specified in the Warehouse field are accepted.
NOTE: If you do not specify a warehouse on the item, you must specify the warehouse from which the items are to be sold or purchased on the sales and purchase order header and on the individual lines. The warehouse specified in the header applies to all lines, unless otherwise individually specified, either on the item or manually on an order line.
1. 2. 3. 4.
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Lab 2.4 - Create a New Item

Contoso Entertainment Systems - Company CEU Scenario You are an employee of Contoso Entertainment Systems, and have been asked to show how to create a new item Long Life Projector Bulb, and specify ordering quantities and some warehouse controls. Specifications for the new item Long Life Projector Bulb are as follows: The Item number is 160906. The Item name is Long Life Projector Bulb. The Item group is Projectors. The Inventory model group is FIFO. The Dimension group is N-W. This bulb can only be purchased in multiples of ten at a cost of 200 U.S. dollars (USD) each. The minimum order amount is ten pieces and the maximum is 100. The standard order quantity is ten. These settings are also the same for Inventory. The bulbs must be purchased into and stored in to Site 2, and Warehouse 21 and must not be moved from here. Therefore, they can only be sold from this warehouse, too. Contoso Entertainment Systems sells the bulbs in boxes of two. Therefore, two pieces equals one box. Each box has a sales price of 520 USD. Create a purchase unit of measure as pieces (Pcs), and a sales order unit of measure as Box, and set up a conversion.
Challenge Yourself!
1. Create the item with the specifications from the scenario.
STOP HERE: The rest of this lab requires knowledge and skills you will gain later in Microsoft Dynamics AX 2009 Trade and Logistics I. The rest of the lab, in Challenge Yourself Part 2, is therefore an instructor-led demonstration. The reason for continuing the lab is to show the effect that item setup has on transactions with the item. You may want to revisit this lab later when you have completed the two courses, at which stage you can execute all the steps in the lab.
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1. Create a purchase order with vendor 1103 for 150 pieces of the new item 160906. 2. Questions: o What does the prompt ask you? o How do you override the check and have the 150 pieces inserted in the purchase order line? 3. Invoice update the purchase order. 4. Create a sales order with customer 1202 for 80 boxes of item number 160906. 5. Try to invoice update the sales order. 6. Question: Why is the update canceled?
Need a Little Help?

1. All the setup you must do for the item is performed from Inventory management > Items. 2. You must perform a unit conversion to convert pieces into boxes. 3. You perform the order quantity and storage setup in Default order settings form and Site specific order settings form.
Step by Step
Challenge Yourself - Part 1 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. Click Inventory management > Item details. Press CTRL+N to create a new item. Enter the Item number 160906. Enter the Item name Long Life Projector Bulb. TAB to the Item group, click the arrow, and select Projectors. Click the General tab, click the arrow in the Inventory model group field, and select FIFO. Click the arrow in the Dimension group field and select N-W. Press CTRL+S to save the record. Click the References tab, and then select Pcs in the Purchase unit field. Click Setup > Unit conversion and press CTRL+N to create a new line. Select Pcs in the From unit field, and then type 2.0 in the Factor field. Select Box in the To unit field, and notice the 2 pieces = 1 box formula at the bottom of the form. Close the Unit conversion form.
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14. In the References tab of the Items form, select Box in the Sales unit field, and then select Pcs in the Inventory unit field. 15. Click Setup > Default order settings > General tab, and then modify these fields as follows: a. Purchase site = 2 b. Inventory site = 2 c. Sales site = 2 16. Click the Purchase order tab, and then modify these fields as follows: a. Mandatory site = selected b. Multiple = 10 c. Min. order quantity = 10 d. Max. order quantity = 100 e. Standard order quantity = 10 17. Click the Inventory tab, and then modify these fields as follows: a. Mandatory site = selected b. Multiple = 10 c. Min. order quantity = 10 d. Max. order quantity = 100 e. Standard order quantity = 10 18. Click the Sales order tab, and then modify these fields as follows: a. Mandatory site = selected 19. Close the Default order settings form. 20. Click Setup > Site specific order settings, and then modify these fields as follows: a. Site = 2 b. Purchase warehouse = 21 c. Inventory warehouse = 21 d. Sales warehouse = 21 21. Click the Purchase order tab and select the Mandatory warehouse check box. 22. Click the Inventory tab and select the Mandatory warehouse check box. 23. Click the Sales order tab and select the Mandatory warehouse check box and close the Site specific order settings form. 24. Click the Price/Discount tab.
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25. In the Price field in the Base purchase price field group, enter 200 26. In the Price field in the Base sales price field group enter 520 27. Close the Items form. Challenge Yourself - Part 2 1. Create a purchase order as per the instructions in the lab. 2. Answers: a. You are warned that the maximum order quantity is 100 pieces. b. Click No to override the maximum order quantity. 3. To invoice the purchase order click Posting > Invoice, in the Quantity field, select All and enter a number in the Invoice field. 4. Click OK to run the update. 5. Create the sales order as specified in the lab. 6. Click Posting > Invoice. In the Quantity field select All. 7. Click OK. 8. Answer: The sales order update is canceled as there is insufficient on-hand inventory to fill the order. This is because 80 boxes equals 160 pieces of the item which is ten pieces more than you purchased.
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Item Pricing
You can set up an item's price by using Costing versions or by manually specifying base prices on the Price/Discount tab of the Items form. Costing Versions Costing versions enable users to create distinct user-defined environments, for maintaining and calculating items planned costs. The Costing versions setup form is found in Inventory management > Setup > Costing versions. Manual Specification of Base Prices In the Items form on the Price/Discount tab, specify price information for an item if you are not using the costing method Standard cost, and if you are not using Costing versions. In the price information fields, specify a purchase order price, a cost price and a sales price for the item. You can first specify these values manually or you can have the system update any or all prices based on transactions in the system by using Sales price models.
Costing Versions
Users can enter and maintain planned items costs, cost categories rate, indirect costs rate, and ratio in Costing versions. The BOM calculation executed on the Costing version calculates and appends the manufactured item planned costs to it. The costs created with a status of Pending can be activated, discreetly or else in mass, to become effective and be applied to production costing. Attributes on Costing versions, enable constraints of content and cost calculations in that version. Items costs in a Costing version can be analyzed and maintained individually or for each Costing version. Active cost history is kept, with full details.
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You create and setup Costing versions in Inventory management > Setup > Costing versions.
FIGURE 2.23 COSTING VERSIONS FORM
You maintain Costing versions in Inventory management > Periodic > Bill of materials > Costing versions. You maintain and setup Costing versions for individual items in Inventory management > Item Details > Prices.
NOTE: The Costing version feature is available on all types of costing methods. However, when standard cost is enabled, there are principles in the Costing version setup form that are restricted and cannot be changed.
Scenario: Costing Version

Vince, the Operating Manager wants to build up next year's standard costs. Vince creates a new dedicated Costing version for those. Various contributors populate the Costing version with next years purchased item costs, cost category rate, and indirect cost ratios. A BOM calculation, executed on the Costing version, calculates and inserts the standard costs for a manufactured item in the version. The calculation is based on the Costing version cost set. Vince reviews the content of the Costing version, correcting as necessary and locking the Costing version as soon as he is satisfied with its content. At the beginning of the new year, Vince mass activates the Costing versions costs. This makes them effective and applied for inventory valuation and production costing in the new year.
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Costing Version Types
There are three Costing version types. Planned Cost: Use this Costing version for items that do not use the Standard cost Costing method. Standard Cost: Use this Costing version for those items that use the Standard cost Costing method and all other items that rollup directly to a Standard cost based BOM. Conversion: Use this Costing version when you convert an item from a non standard cost Costing method to the Standard cost Costing method.
You can select the Planned cost and Standard cost Costing version types in the Costing versions form. You can create the Conversion Costing version in the Standard cost conversion form.
Costing Versions - BOM Calculation

A Costing version can also contain data about item sales prices or purchase prices for BOM calculation purposes only. A BOM calculation can calculate a sales price for manufactured items, and can also generate an associated sales price record within the Costing version. A BOM calculation with planned costs can be based on item purchase price records within the Costing version, instead of item cost records. The item purchase price records must be manually entered. The item sales price records and purchase price records are only used for BOM calculation purposes.
Item Price Form

Inventory management > Item details > Price button The Item price form is used to view cost history and maintain item cost records for an individual item. You would typically use the Item price form to create cost prices for a new item and use the Costing versions form to create cost prices for existing items.
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Data maintenance includes entering pending costs for a purchased item, calculating pending costs for a manufactured item, and activating pending cost records. Activating a pending cost record will change its status from Pending to Active and will change its effective date to the activation date. The Item price form displays pending and active cost records on different tabs. Different cost records for an item may reflect a different Costing version, site, effective date, or status.
FIGURE 2.24 ITEM PRICE FORM - PENDING TAB
The form can also be used to view and maintain information about item sales price records and item purchase price records within a Costing version. Generate an item's sales price record by using the BOM calculation form to calculate an item's sales price.
Item Price Form Details

The following table describes the fields in the Pending prices tab of the Item price form. Field Price type Description Shows whether the information applies to an item cost record, an item sales price record, or an item purchase price record. Costing version for the record. Name of the Costing version for the record. Show the applicable site for the record. Item cost records must be maintained by site (when you use multisite functionality).
Version Name Site
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Field Price
Description Enter the pending cost, display the calculated pending cost for a manufactured item, or display the active cost for a cost record. Show the quantity that is related to the item cost record. An item's cost is typically expressed for a quantity of 1. However, it may be expressed for every 100 or 1000 to handle decimal precision issues. Enter pending costs for miscellaneous charges for a purchased item, calculate the miscellaneous charges for a manufactured item (based on the amortization of constant costs), or display the miscellaneous charges for an active cost record. Show the quantity that is related to the item's miscellaneous charges. The miscellaneous charges will be amortized over the specified quantity. Show if miscellaneous charges will be included in the item's unit cost. Miscellaneous charges must be included when the Costing version reflects a standard cost type. Displays the unit of measure for the cost record. An item cost record must be expressed in the item's inventory unit of measure. Show the intended effective date for a pending cost record. The date may be defaulted from the Costing version. A system-assigned flag that indicates that an active cost record cannot be maintained, or that the blocking flag for the Costing version has blocked changes to pending cost records. A system-assigned flag that indicates that the cost record contains a calculated cost for a manufactured item. A system-assigned flag that indicates that an Infolog exists for the cost record. You can view this by clicking the Log button. The Infolog contains warnings that are generated by the BOM calculation for the cost record.
Price unit
Price misc. charges
Price quantity
Incl. in unit price
Unit
From date
Blocked
Calculated
Log
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Activate Pending Prices
To activate a pending price for an item, click Activate in the Pending prices tab. The Active prices tab has an additional field Activation date, that shows when the price was activated. To activate pending prices for many items, use the Costing version form.
Procedure: Create a Costing Version

To create a Costing version, perform the following: Open Inventory management > Setup > Costing versions. Press CTRL+N to create a new line. Select a Costing type. Insert text in the Version field. Insert text in the Name field. Select Yes, or No in the Block field (depending on if the version needs to be blocked for usage or not). 7. Set Block activation to Yes. 8. Save the record. 1. 2. 3. 4. 5. 6.
Procedure: Add Items in a Costing Version

To add an item's costs in a Costing version, perform the following: 1. Open Inventory management > Periodic > Bills of materials > Costing versions. 2. Select a record in the Costing version maintenance form. 3. Click button Price > Item price. 4. Complete fields as required on the Pending prices > Overview tab. 5. Save the record and close the Item price form.
Procedure: Activate Cost Prices from a Costing Version

To activate cost prices from a Costing version setup form, perform the following: 1. Open Inventory management > Setup > Costing versions. 2. Select a record in the Costing version setup form. 3. Ensure that the Block field is set to No. Otherwise, it will be blocked for input. 4. Select No in the Block activation field to ensure activation can be performed. 5. Click the Activate button.
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6. Select only the Cost price check box to activate the cost price only. 7. Click OK.
Procedure: Specify Prices Manually in the Items Form

To specify prices manually for an item: 1. Click Inventory management > Item details. 2. Click the Price/Discount tab. 3. Enter a value in the Price field of the Base purchase price, Base cost price or Base sales price headings or all prices for the item.
NOTE: If you select the Fixed receipt price field on the Setup tab in the Inventory model groups form, item receipts are always made at the price specified in the Price field under the Base cost price heading and item issues are made at the current inventory value. Fixed receipt price cannot be selected when you use the Standard cost Costing method.
The price for a specific item is based on the number of units specified in the Price unit field. If the value is 1 or blank, the cost applies for one unit of the item. However, if you specify a value more than one or zero then the price applies for this multiple quantity of the item.
EXAMPLE: You buy a box of 50 items where the price unit equals 50, the cost applies for 50 units of the item. When you enter purchase order lines, sales order lines, or inventory journal lines, the unit price is automatically converted for the quantity given on the line.
Procedure: Update Prices Automatically in the Items Form

As mentioned earlier, you can also set Microsoft Dynamics AX 2009 to automatically update prices. To have prices automatically updated, follow these steps: 1. 2. 3. 4. Click Inventory management > Item details. Select an item. Click the Setup tab. Select or clear the Latest purchase price check box. By selecting this check box you can update the purchase order price in the Items form with the latest purchase order price excluding discount and miscellaneous charges.
EXAMPLE: The price of oil or steel fluctuates greatly. When you purchase these items, the best guide to the purchase price is probably the last price that you paid.
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5. Select or clear the Cost price field to always update for the last receipt from the inventory journal or from a production report-asfinished where a BOM line is returned to inventory. If you leave this check box blank, production costs will only be updated manually. 6. Select how sales price must be updated. The following table shows the methods you can select to update the sales price.
Sales Price Model Methods

Sales price model None Contribution ration Calculation method Setting of the sales price is manual and no automatic updating of the sales price occurs. Calculate sales price by using a percentage markup on either the purchase or cost price. The formula for the calculation of the sales price with this setting is as follows: Sales price = 100*Cost/Purchase price (100-Contribution ratio) Example: Purchase price = 40 USD Contribution ration = 10 percent Sales price: 100*40 = 44.44 USD (100-10) Miscellaneous charges represent, for example, freight, handling fees, or import fees. In sales price calculation, the Misc. charges pct. is multiplied by the base price, either the purchase or cost price for the item, and then added to the price of the item. For example, the item QRI has the sales price model Misc. charges pct. and the miscellaneous charges percent is 20. The sales price is therefore 20% * 0.45, the base price selected price, 0.09 plus 0.45 USD. The sales price on the sales order line for one pieces of QRI is therefore = 0.54 USD.
Misc. charges pct.
If a sales price model is used and then discontinued, all sales price updates will be made based on values proposed on a new line.
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Summary
Inventory reviewed how to use the functionality associated with inventory management in Microsoft Dynamics AX 2009. The following areas were covered: Setting up item groups and examining the posting types Setting up inventory model groups and inventory dimension groups and reviewing how they affect the way item transactions are handled Creating items and setting up unit conversions and item pricing
Discovering how inventory management works in Microsoft Dynamics AX 2009 helps you manage the following: How and if posting occurs Control of receipt and issue of items How inventory costing is set up with regard to dimensions The level of detail with which you categorize and store items
Additionally, learning about how to set up items in the context of inventory management helps you determine how items must be set up and priced according to the specific needs of the business.
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Test Your Knowledge

Test your knowledge with the following questions. 1. To which account in Item groups do you post costs associated with a sales order, at the point of packing slip update? ( ) Sales order tab > Packing slip revenue ( ) Purchase order tab > Packing slip ( ) Sales order tab > Revenue ( ) Sales order tab > Packing slip 2. To which account in Item groups do you post commission paid to a salesperson, after a sale has been completed? ( ) Sales order tab > Commission offset ( ) Sales order tab > Revenue ( ) Sales order tab > Salesperson commission ( ) Sales order tab > Commission 3. To which account in Item groups do you post tax associated with a purchase order, at the point of packing slip update? ( ) Purchase order tab > Packing slip tax ( ) Purchase order tab > Packing slip revenue tax ( ) Purchase order tab > Packing slip purchase ( ) Purchase order tab > Charge 4. To which account in Item groups do you post discounts granted on sales orders? ( ) Sales order tab > Consumption ( ) Sales order tab > Issue ( ) Sales order tab > Discount ( ) Sales order tab > Line discount 5. To which account in Item groups do you post the variance in the amount an item was sold for, compared to the cost of the item at the time that it was returned? ( ) Sales order > Credit note ( ) Sales order tab > Consumption ( ) Purchase order > Stock variation ( ) Inventory > Standard cost profit & Standard cost loss
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6. Which parameter enables items attached to the inventory group to be sold even though there are no physically updated quantities of the item available? ( ) Negative financial inventory ( ) Negative physical inventory ( ) Post physical inventory ( ) Quarantine management 7. What is the name of the inventory model group parameter that together with the Post packing slip in the ledger parameter in Accounts receivable/Accounts payable enables ledger posting at physical update? ( ) Post financial inventory ( ) Post physical inventory ( ) Physical negative inventory ( ) Post packing slip 8. How, in the inventory model group, do you ensure that all items attached to this group have their receipts registered at the company? ( ) Select Picking requirements ( ) Select Post physical purchase ( ) Select Registration requirements ( ) Select Quarantine management 9. Which of the following is not an item dimension? ( ) Configuration ( ) Color ( ) Batch ( ) Size 10. Which parameter must you select for a dimension to ensure that average cost prices are calculated for each dimension value when you run inventory closing? ( ) Financial inventory ( ) Physical inventory ( ) Primary stocking ( ) Coverage plan by dimension
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11. Which of the following is not true about inventory dimensions? ( ) You can create combinations of item dimensions. ( ) You can lock dimensions for editing on purchase and sales order lines. ( ) Serial numbers are always unique. ( ) If a dimension in a dimension group has Primary stocking selected, you must specify the dimension value before physical updates are made for items attached to the group. 12. Which item setting can be translated into other languages to appear, for example, on external documents in its translated form? ( ) Item number ( ) Search name ( ) Item name ( ) Company item 13. When you specify the cost for an item, in which field do you specify the quantity for which the cost applies? ( ) Multiple ( ) Price unit ( ) Price number ( ) Price quantity 14. Which setting in Items ensures that only one specific warehouse is used for purchase, storage, or sale orders or all three? ( ) Stopped ( ) Mandatory ( ) Locked ( ) Closed
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2.
3.
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Solutions
Test Your Knowledge
1. To which account in Item groups do you post costs associated with a sales order, at the point of packing slip update? ( ) Sales order tab > Packing slip revenue ( ) Purchase order tab > Packing slip ( ) Sales order tab > Revenue () Sales order tab > Packing slip 2. To which account in Item groups do you post commission paid to a salesperson, after a sale has been completed? ( ) Sales order tab > Commission offset ( ) Sales order tab > Revenue ( ) Sales order tab > Salesperson commission () Sales order tab > Commission 3. To which account in Item groups do you post tax associated with a purchase order, at the point of packing slip update? () Purchase order tab > Packing slip tax ( ) Purchase order tab > Packing slip revenue tax ( ) Purchase order tab > Packing slip purchase ( ) Purchase order tab > Charge 4. To which account in Item groups do you post discounts granted on sales orders? ( ) Sales order tab > Consumption ( ) Sales order tab > Issue () Sales order tab > Discount ( ) Sales order tab > Line discount 5. To which account in Item groups do you post the variance in the amount an item was sold for, compared to the cost of the item at the time that it was returned? ( ) Sales order > Credit note () Sales order tab > Consumption ( ) Purchase order > Stock variation ( ) Inventory > Standard cost profit & Standard cost loss
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6. Which parameter enables items attached to the inventory group to be sold even though there are no physically updated quantities of the item available? ( ) Negative financial inventory () Negative physical inventory ( ) Post physical inventory ( ) Quarantine management 7. What is the name of the inventory model group parameter that together with the Post packing slip in the ledger parameter in Accounts receivable/Accounts payable enables ledger posting at physical update? ( ) Post financial inventory () Post physical inventory ( ) Physical negative inventory ( ) Post packing slip 8. How, in the inventory model group, do you ensure that all items attached to this group have their receipts registered at the company? ( ) Select Picking requirements ( ) Select Post physical purchase () Select Registration requirements ( ) Select Quarantine management 9. Which of the following is not an item dimension? ( ) Configuration ( ) Color () Batch ( ) Size 10. Which parameter must you select for a dimension to ensure that average cost prices are calculated for each dimension value when you run inventory closing? () Financial inventory ( ) Physical inventory ( ) Primary stocking ( ) Coverage plan by dimension
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11. Which of the following is not true about inventory dimensions? ( ) You can create combinations of item dimensions. ( ) You can lock dimensions for editing on purchase and sales order lines. () Serial numbers are always unique. ( ) If a dimension in a dimension group has Primary stocking selected, you must specify the dimension value before physical updates are made for items attached to the group. 12. Which item setting can be translated into other languages to appear, for example, on external documents in its translated form? ( ) Item number ( ) Search name () Item name ( ) Company item 13. When you specify the cost for an item, in which field do you specify the quantity for which the cost applies? ( ) Multiple () Price unit ( ) Price number ( ) Price quantity 14. Which setting in Items ensures that only one specific warehouse is used for purchase, storage, or sale orders or all three? ( ) Stopped () Mandatory ( ) Locked ( ) Closed
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Chapter 3: Purchase Orders and Purchase Order Posting
CHAPTER 3: PURCHASE ORDERS AND PURCHASE ORDER POSTING

Objectives
The objectives are: Create a Purchase order by using the Simple and Advanced views Determine and apply the different Purchase order types Set up Accounts payable Purchase order parameters Specify alternative receipt addresses for a Purchase order line Identify the different types of Purchase order posting Perform a Purchase order posting update Post a Purchase order receipts list Post a Purchase order packing slip Post a Purchase order invoice Explain how a user can post a Purchase order invoice based on a packing slip Examine invoice matching of the Purchase order and packing slip information Set up Purchase order posting profile
Introduction
Purchase Orders and Purchase Order Posting discusses basic and advanced Purchase order functionality. The Working with Purchase Orders lesson explains how to create a Purchase order by using the Simple and Advanced views in the Purchase order form. Additionally, you will investigate the different Purchase order types. The course also examines parameter selections in Accounts payable and how these affect creating Purchase orders. The posting lessons describe how to post Purchase orders in four steps: Purchase order Receipts list Packing slip Purchase order invoice
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Additionally, you will discover the more advanced Purchase order functionality that is introduced in Microsoft Dynamics AX 2009. Finally, the course reviews the Multiple ship to functionality, which lets you specify delivery addresses for Purchase orders.
Working with Purchase Orders

Companies can create a new Purchase order by using the Simple view and the Advanced views in the Purchase orders form and can add items to the Purchase order. Depending on their business needs, a company can also use different Purchase order types.
Purchase Orders Simple View

The Purchase order form opens, by default in the Simple view and shows the last Purchase order created. The Simple view only shows the user one Purchase order at a time. If other Purchase orders exist, it displays the last order entered, assuming that sequential Purchase order numbers are being used.
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Use the Simple view in the following situations: When you have to quickly enter information about a single Purchase order. When the user does not have to use the functionality that is available in the Advanced view.
FIGURE 3.1 PURCHASE ORDER FORM - SIMPLE VIEW
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Procedure: Navigate the Purchase Order in Simple View
To navigate the Purchase order by using the Simple view: 1. Click Accounts payable > Purchase Order Details. The Purchase order form opens in the Simple view. 2. To view other Purchase order records by using the Simple view, use the arrows located on the toolbar.
FIGURE 3.2 MENU BAR - CHANGE RECORDS
Alternatively, you can right-click the Purchase order field and use the Filter by Field function to search for a particular Purchase order.
3. Click Advanced to open the Advanced view.
Procedure: Create a New Purchase Order Header

You can create a Purchase order header by using the Simple view. Notice that all the following information is also relevant for creating Purchase orders in the Advanced view. 1. Click Accounts payable > Purchase Order Details. 2. Press CTRL+N to create a new Purchase order. 3. In the Create Purchase order form, select a supplier. Depending on the parameter settings, you may receive a prompt from Microsoft Dynamics AX 2009 to transfer the vendor information. 4. Make selections in the Vendor field group. The settings for this field group are described in the Create Purchase Order Form Parameters topic. a. One-time supplier b. Delivery address c. Invoice account 5. Make selections in the General field group: a. Purchase type b. RMA number c. Currency
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6. In the Delivery address field group, the address defaults from base data. You can override the delivery address by clicking the Alt. address button and specifying an alternative address. 7. In the Administration field group, select the setting related to the buyer group, and the person placing the order and the purchase pool that the Purchase order belongs to. This is useful for filtering Purchase orders.
Create Purchase Order Form Parameters

The parameters in the Create Purchase order form allow you to set up the data on the Purchase order header that contain the basic information about the vendor and how the order should be invoiced. The following parameters will be covered in this topic. One-time supplier Delivery Address Invoice account Purchase type RMA number Currency Administration field group
One Time Supplier

Use the One-time supplier function when you are working with a supplier that does not exist in the Vendors form. Before you use this function, ensure that a number sequence has been set up for one-time suppliers in Accounts payable > Setup > Parameters > Number sequences.
EXAMPLE: A one-time supplier can be used when the demand for an item exceeds the capacity of the company's usual supplier, or when the company has an order for an item they do not usually carry.
Delivery Address and Invoice Account

The Delivery address is taken from the base data and is the standard delivery address for your company. The Invoice account is used if the account number of the vendor who you receive the invoice from and where you must pay differs from the vendor with whom you put the Purchase order.
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Purchase Type
The Purchase type can be Purchase order or another type of Purchase order.
NOTE: You can change a Purchase order type at any time before items have been received. The Purchase Type field is automatically filled with the default purchase type specified in Purchase parameters.
RMA Number
The Create Purchase order form displays the Return Materials Authorization (RMA) number when Returned order is selected in the Purchase type field. This number is provided by your supplier and is used for tracking a return item. The field is mandatory when the purchase type is Returned order.
NOTE: The RMA number is only visible on the Create purchase order form when the Purchase order type is Returned order.
Currency
The currency code attached to the vendor is copied automatically when the vendor is selected. The currency code is mandatory and you can change it when a Purchase order line has been entered. Example 1: Occasionally, a vendor will ask to be paid for an order in another currency, perhaps because they are purchasing the component items in a different currency. For example, the vendor usually bills in euro (EUR), but for a particular order, has requested that the invoice be paid in U.S. dollar (USD). Vendor ledger entries for this invoice will be in USD. However, the General ledger entries will be in the vendor's functional currency, which in this case is EUR. Example 2: You can only have one Currency for each Purchase order. Select the currency by clicking the square arrow in the Currency field. When the invoice for the current Purchase order is updated, the invoice balance is posted in the selected currency and company currency. The system compares the exchange rate at posting and payment, and then automatically posts the differences to the exchange rate gain and loss account.
BEST PRACTICE: In the parameters you can define a safety level for invoiced orders. Set the parameter to locked so that the user cannot change an invoiced order.
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Administration Field Group
The Administration field group contains the following fields: Buyer group: Type or select a buyer group that is in the Buyer groups form. Orderer: Select the name of the employee who ordered the purchase. The employee must be set up in the employee table. Pool: You can group your purchase orders into pools for filtering and selection purposes. Language: Specify the language setting for the Purchase order. This affects the language that is used for item names and for printing external Purchase order documents.
EXAMPLE: Select an item in the Items form and then click Setup > Language - Item description. Select a language and enter the translation text. Create a new Purchase order and in the Language field group select the language for which you created a translated text. Print, for example, a receipts list and the item's name is printed out by using the foreign language text.
Requisitioner: The user who requested the items, if the purchase order was created from a Purchase requisition. The field is blank if multiple users requested items that are included in the same purchase order.
Procedure: Create Purchase Order Lines

After you create the Purchase order header, you must create Purchase order lines. To create Purchase order lines in the lower pane of the Purchase order form, follow these steps: 1. Click Accounts payable > Purchase Order Details. 2. Select a Purchase order or create a new Purchase order. 3. In the lower pane, enter the following information: (see more details about these parameters after this procedure) a. Item number b. Inventory dimensions c. Quantity d. Unit e. Unit price f. Discount g. Disc. Pct.
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Purchase Order Line Parameters
The Purchase order line parameters are where you set up the item specific parameters for the Purchase order. The parameters that are discussed in this topic are the following: Item number Site Inventory dimensions Quantity Unit Unit price Discount Disc.Pct. Net amount
Item Number Enter the item number or select it by clicking the Item number field. Base data is copied to the purchase line together with the item number and information such as the item name, unit, from the Items form with vendor-specific prices and line discounts from the Price Agreements table. Purchase markups are retrieved from the Misc. Charges Code. Inventory Dimensions Enter the item dimensions of Configuration, Size, Color, and inventory dimensions. You can enter Site, Warehouse, Batch number, and Serial number in the inventory dimension fields for each purchase line. Quantity Enter the quantity of the item in its purchase unit. If the standard purchase quantity has been specified in the Default order setting or Site specific order setting, this quantity will be proposed automatically. The proposed quantity is rounded up to the nearest multiple of the Quantity field, if defined in the Default order settings or Site specific order settings. You can also specify a minimum and maximum purchase quantity in the Default order settings and Site specific order settings. If the quantity entered does not fall within the defined limits, you are warned before the quantity is approved.
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Unit The purchase unit is the purchased item's unit of measure. There is a close relationship between the purchase unit and the inventory unit. For example, the item may be purchased in kilos and stocked in grams. The Purchase unit reflects the vendor's sales unit. The actual conversion factors for the units are set up globally in the Basic module or specifically for each item through the Items form. Unit Price You can transfer a proposal for the purchase price of the item from the Price field on the Items form. Notice that if a purchase price agreement is set up, the price on the agreement is always used. Discount A line discount amount can be entered in the Discount field. This is calculated as a discount for each price unit. The amount is automatically transferred from the line discount agreements set up in Trade agreements. To do this, Trade agreements must be activated. Disc. Pct. A line discount percentage can be entered in the Disc.pct. field, or you can generate one from the line discount agreements created in Trade agreements. To do this, Trade agreements must be activated. The line discount is calculated from the complete line amount, after deducting the discount amount and adding other order markups. See also calculation of the line amount in the Net amount field. When the invoice is updated for the purchase, the total discount are posted in accordance with the posting profiles. Net Amount The Net amount is an expression of the total price of the purchase line after deduction of discounts and addition of various expenses.
Simple View Buttons

The Simple view in the Purchase order form does not display all available fields and tab pages. This applies to the menu and function buttons on the Purchase order also.
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The following table provides an overview of the buttons available in Simple view. Buttons Advanced Posting Pro forma Short description Change view to the Purchase order form's Advanced view. Print or post the documents available. A Pro forma order is when an order is printed but not posted. It can be used to test how a print will look before actually committing it to General ledger. Print a Pro forma Purchase order, receipt list, packing slip, or invoice. NOTE: You can print the documents, however, you cannot post them. Inquiries View totals, cash flow forecasts, receipts list, packing slip and invoices. By selecting the Attached Purchase orders sub-menu item from a Purchase order of the type Blanket order you can also view attached release Purchase orders. Open the Create lines dialog box to quickly create multiple Purchase order lines for the Purchase order. View the relevant intercompany documents that relate to the intercompany Purchase order. See the Microsoft Dynamics AX2009 Intercompany course for more information about Intercompany features. NOTE: This button is only active when the Purchase order is an Intercompany purchase.
Create Lines Intercompany
Create Lines Button

Use the Create lines button to quickly create multiple Purchase order lines for a Purchase order. By using this functionality, you minimize key strokes, and data entry is expedited. Procedure: Create Purchase Order Lines with the Create Lines Dialog Box To create Purchase order lines by using the Create lines dialog box, follow these steps: 1. Click Accounts payable > Purchase Order Details. 2. Create a new Purchase order or select an existing one. 3. Click the Create lines button. Notice that in the Advanced view you access the Create lines by clicking Functions > Create lines in the lower pane.
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4. Click either: o Existing items - To list all items. o New items - To create lines for items for which there are no order transactions. 5. Enter the quantity to purchase for each line in the Create lines dialog box, and then click Create. The form is then closed, and the Purchase order lines are created. You can also click Apply which will create the Purchase order lines and keep the Create line dialog box open for creating more lines.
Purchase Order - Advanced View

Use the same steps that were performed in the Simple view to create a Purchase order using the Advanced view. The difference between the two views is how much information and functionality the user has access to. One of the principle differences between the two Purchase order views is the many functions you can access by using the buttons in the Advanced view.
FIGURE 3.3 PURCHASE ORDER FORM - ADVANCED VIEW
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Buttons in Advanced View
The following table describes the functionality of some of the Advanced view buttons. In the Lines section of the Purchase order form you can see the functions that are specific to the Purchase order lines section of the Purchase orders form. Button Simple/Advanced Posting Pro forma Trade agrmt. Calculation Inventory Description Toggles between the two views. Print or post the available documents. Print a Pro forma Purchase order, receipt list, packing slip, or invoice. Maintain or view trade agreements, prices, and discounts. Calculate multiline and total discount or supplementary items. View inventory transactions and on-hand inventory. You can also reserve and register items from this submenu.
Buttons in Advanced View - Setup

The Setup button on the Purchase order header is where you add or view additional order information. From this button, you can perform the following actions: Set up and allocate miscellaneous charges. Specify sales tax and payment schedule settings. Link to the Planned Purchase orders form. Add more contact persons for the Purchase order than those specified for the vendor. Setup Print management settings. Indicate whether summary updates can be specified for the Purchase order.
The Setup button on the Purchase order line is where you can specify: An alternative delivery address for a specific warehouse. Learn more about this in the topic on Multiple Ship to Multiple Addresses. Miscellaneous charges and sales tax settings.
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Buttons in Advanced View - Functions
The Functions button on the Purchase order header is where you can: Copy from order journals Create credit notes Perform open transaction editing Create release orders and other functions
In addition to the functions that are also available on the header, you can also access the following by using the Functions button on the Purchase order line: Explode an item of type BOM into its component items. Use the Deliver remainder function to update back orders. For more information, see the table about the Functions button later in this lesson.
Buttons in Advanced View - Inquiries

The Inquiries button on the Purchase order header is where you can view totals, cash flow forecasts, receipts list, packing slip, pending invoices and invoices. The Inquiries button on the Purchase order lines is where you can access the Net requirements and Explosion functionality.
Functions Button
When you open the Functions button in the Purchase order header and the Purchase order lines, you will find the following functionality. Copy From All Copy From Journal Create Credit Note Create Based on Sales Order Create Release Order Deliver Remainder
The following is a more detailed breakdown of this functionality.
Copy from All

When you create a Purchase order, the Copy from all function lets you view all Purchase orders, packing slips, and invoices and lines, to select a document or lines most like the one(s) being created. This data can be copied and used as a starting point for the new Purchase order.
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This function helps when you create a new Purchase order that resembles one created for a different vendor, or even for the same vendor for a different item or quantity. Within this option, users can configure the copying of these variables in the Quantity and Setup field groups: Quantity factor Invert sign Copy miscellaneous charges Recalculate price Copy precisely Delete purchase lines Copy order header
Copy from Journal

You can create purchase order lines by copying lines from other purchase orders or from previously updated purchase orders, packing slips, or invoices. Use the Copy from journal form for various methods of copying purchasing information. With the Copy from journal option, users can configure the copying of the same variables in the Quantity and Setup field groups as they did for Copy from all function.
Create Credit Note

The Create credit note function is only used for creating credit notes based on existing and invoiced Purchase orders or lines for the same vendor. The Invert sign check box is selected by default. Within the Create credit note option, the user can select or clear the Delete purchase lines check box if purchase lines exist within the present Purchase order.
Create Based on Sales Order

The Create based on sales order function allows for a direct link to be made between a Purchase order and a sales order. For example, the purchaser wants to create a summed Purchase order for all sales orders for a particular item. Therefore, he or she performs the following: 1. Creates a new Purchase order and clicks Functions > Create based on sales order. 2. Clicks Select and enters a query to find all sales order lines with the same item attached to it. 3. Selects the Include all check box and then clicks OK to create one Purchase order to cover all sales order requirements.
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A Purchase order with lines to cover all the sales order requirements is created. When the Purchase order is created, each line references the sales order requirement. Additionally, the sales order and Purchase order are now marked against one another.
NOTE: A vendor must be specified for the Purchase order that this defaulted from or you must enter the Vendor account manually.
Create Release Order

Use the Create release order function to release quantities of items from a blanket order. After you have created a release order a Purchase order is generated which is handled in the same manner as a typical Purchase order.
Deliver Remainder
The Deliver remainder function is available only on the Purchase order line. By selecting this function, the user is prompted with a dialog box within which he or she can request delivery of any of the open quantity on this Purchase order. The user can also click the Cancel quantity button from this dialog box. This sets the backorder quantity to zero and cancels the remaining order. This can help when a user is receiving a partly delivered Purchase order, or from a blanket order or subscription.
Purchase Order Types

When you create a new Purchase order, Microsoft Dynamics AX 2009 offers several options on the Create Purchase order form. There are five Purchase order types to select from depending on the process or action the user needs: Journal Subscription Purchase order Returned order Blanket order
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FIGURE 3.4 PURCHASE ORDER TYPES
Journal
The Purchase order type Journal is used as a draft. It does not affect stock quantities and does not generate any item transactions and the quantity on the order line will not be considered in the Master scheduler.
EXAMPLE: A Purchase order of the type Journal can be used when importing data by batch; in this manner, the Purchase order can be reviewed and evaluated without affecting inventory, on-order, or other numbers.
Demonstration: Create a Purchase Order Journal

This demonstration shows how to create a Purchase order of type Journal and how this affects inventory transactions. 1. 2. 3. 4. 5. 6. Click Accounts payable > Purchase Order Details. Press CTRL+N to open the Create Purchase order form. Select Vendor account 1203. Select Journal in the Purchase order type field. Click OK. Create a Purchase order line for item number 1705.
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7. From the Purchase order line click Inventory > Transactions. Notice that the Transactions sub-item is unavailable. 8. Click Posting and you will see that all posting updates are unavailable as you cannot posting update a Purchase order of the type Journal.
Subscription
The Subscription type of Purchase order is used for repeated purchases of the same goods or services. When a packing slip is updated, Microsoft Dynamics AX 2009 generates a receipt. When the invoice is updated for the receipt, a new packing slip or invoice entry can be updated for the same purchase line immediately or at some future date. The order will never be at an Invoiced status only Open or Received.
EXAMPLE: An example of a recurring order is a monthly replenishment of screws. In this situation, a company purchases a quantity of screws every month with monthly deliveries and billings. When the order is invoiced, the order status is automatically set to open order, the quantity delivered is invoiced, and the delivery remainder is updated.
Demonstration: Create a Purchase Order Subscription

In this demonstration, you will create a Purchase order of the Subscription type and see the effect that invoicing the Purchase order has on its status. 1. Click Accounts payable > Purchase Order Details. 2. Press CTRL+N to create a new Purchase order for vendor 1203. 3. In the Create Purchase order form, select the order type Subscription. 4. Click in the Lines pane and create the Purchase order line for 50 pieces of item number 1705. 5. Click Inventory > Registration to register the items. 6. Invoice the order by clicking Posting > Invoice. 7. Check the details of the invoice and ensure that the Quantity field is set to All and select the Print invoice check box. 8. Select a number in the Invoice field. 9. Click OK. The order is invoiced and an invoice is created for 50 pieces of item number 1705. The Purchase order itself has the status Open order. 10. Repeat steps 5-9. 11. From the Purchase order line, click Inventory > Transactions. Transactions are created every time that you posting update the Purchase order of type Subscription.
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Purchase Order
The Purchase order type is used when you want to send a vendor a purchase order and enter it in the system. When you create a new order, the type can be set to default to Purchase order type in the Parameters form depending on the client's business process.
Returned Order
The Returned order type is used when you return goods to the vendor. A Return Merchandise Authorization (RMA) number supplied by the vendor is required when you enter this kind of order.
EXAMPLE: Your supplier sent the incorrect size of screws. The purchaser contacts the vendor, requests an RMA, and uses the Purchase type Returned order to track the return. This purchase type can also be used to return damaged or otherwise defective goods to the supplier.
Blanket Order
The Blanket order type of Purchase order is used if there is a contract with the vendor for a bulk quantity and price and you want to order off that contract. Typically, a company uses blanket orders to receive better pricing conditions because the blanket order quantity is bigger than on single Purchase orders. Create a Release order to release, order, and invoice items against the Blanket order until the contract is fulfilled. Blanket orders do not affect stock quantities, do not generate item transactions, and are not included in Master scheduling. Release orders, issued from Blanket orders, do affect all these.
EXAMPLE: A company wants to purchase 2,000 pieces of item B. However, because of storage and capital limitations, the company wants the items delivered just in time for use in their production. In this situation, the company contacts the supplier and requests 20 pieces on Monday, 20 pieces on Wednesday, and on the following Monday, an additional 20 pieces. At this point 1940 pieces remain on the open Purchase order. Every time the company orders against this Purchase order, the remaining quantity is decreased until the all the 2,000 pieces have been delivered.
Procedure: Create a Blanket Order

To create a Blanket order, follow these steps: 1. Click Accounts payable > Purchase Order Details. 2. Press CTRL+N to create a new Purchase order. In the Create Purchase order form select the Purchase order type Blanket order.
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3. In the Lines tab, specify the total quantity for the item. 4. To ensure that a quantity and lot is selected when you create a release order, enter a quantity in the Receive now field.
Procedure: Create a Release Order from a Blanket Order

To create a release order from a Blanket order, follow these steps: 1. Click Accounts payable > Purchase Order details. 2. Select the Blanket order. 3. In the Purchase order header, click Functions > Create release order. 4. If you have not entered a quantity in the Receive now field in the Purchase order line for the blanket order, select the LotID, the Purchase quantity, and the Delivery date. 5. Click OK. A new Purchase order is created. Note the reference to the Blanket order in the Blanket order field in the Purchase order overview. 6. Update the Purchase order as you do with an ordinary Purchase order. 7. Go back and examine the blanket Purchase order and then click the Quantity tab. Notice that the Deliver remainder quantity has been reduced by the quantity the released Purchase order was for.
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Lab 3.1 - Create Purchase Orders

Contoso Entertainments System - Company CEU Scenario You are a new accounts payable clerk at Contoso Entertainment Systems. You have been in training all day, and the trainer has left you with the following Purchase orders to create. One Purchase order for 20 item number 1507, from Fog Projectors. One Purchase order for 500 item number 1701, to be purchased in increments of 100, from Opal Electronics. One Purchase order from Topaz Electronics, to be paid to Ruby Electronics, for 50 item number 1705.
Challenge Yourself!
Create the Purchase orders according to the specifications from the scenario.
STOP HERE: The remaining steps, in Challenge Yourself Part 2, of this lab requires skills gained later in Purchase Order and Purchase Order Posting . The rest of the lab is therefore instructor-led. The reason for having the additional steps is to show a whole process flow from order creation to invoice updating. You may want to revisit this lab later when you have completed Purchase Orders and Purchase Order Posting, at which stage you can execute all the steps in the lab.
1. For the second Purchase order, create the release order for the first lot of 100 pieces. 2. For the third Purchase order, register and invoice update the order and ensure that the invoice is printed to screen. Note which address, apart from Contoso Entertainment Systems is located on the invoice. The invoice that is now created has the Ruby Electronics address on it as the billing address for the order.
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Need a Little Help?
1. Use these Purchase types: o Purchase order o Blanket order o Purchase order 2. Change the Invoice account to pay-to a different vendor for the third Purchase order.
Step by Step
1. On the Navigation Pane, click Accounts payable > Purchase Order Details. 2. Press CTRL+N to create a new Purchase order. 3. Select Vendor 1103. 4. Click Yes in answer to the prompt about transferring vendor information. 5. Click OK. 6. Select Item 1507, and 20 will occupy the Quantity field. 7. Click in the Vendor account field. 8. Press CTRL+N to create a Purchase order. 9. Select Vendor 1203. 10. Click Yes in answer to the prompt about transferring vendor information. 11. Click OK. 12. Select Blanket order as the Purchase type, and then click OK. 13. Select Item 1701. 14. Type 500 in the Quantity field. 15. TAB off the Quantity field. 16. Click the Quantity tab. 17. Type 100 in the Receive now field. 18. Move to the header block and press CTRL+N to create a new Purchase order. 19. Select vendor 1201. 20. Click No in answer to the prompt about transferring vendor information. 21. Click the arrow in the Invoice account field. 22. Select vendor 1202. 23. Click Yes in answer to the prompt about transferring terms of payment information. 24. Select USD in the Currency field.
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25. 26. 27. 28. 29. Select en-us in the Language field. Click OK. Select item 1705 TAB to the Quantity field and type 50. TAB off the Quantity field.
You have now set up the three orders as instructed in the first part of the lab. In the next part of the lab, you will create a release order for the blanket order and invoice update the Purchase order for which the vendor and invoice address are different. 1. Click the Purchase order of type Blanket order and then click Functions > Create release order. 2. Click OK and a Purchase order is created for the first release quantity. 3. Click the third order you created. 4. Click Inventory > Registration and post the registration. 5. Click Posting > Invoice. 6. Select the Print invoice check box. 7. Click OK.
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Set Up Accounts Payable Purchase Parameters

In the Accounts payable parameters, you can create default settings that are used by the Purchase order. You will find the Accounts payable parameters in Accounts payable > Setup > Parameters. The fields in the Accounts payable parameters are: Purchase Type Prompt When Specifying Vendor and Invoice Account Purchase Order Prices/Amount One-Time Vendor Account
Purchase Type
Select any one of the Purchase order types as the proposed default type when you create a Purchase order. You can override the setting at order creation. The Purchase type parameter setting is useful if you normally use a particular Purchase order type in the Purchase order process. For example, if your company always starts the Purchase order process with an order of type Journal before continuing to make a confirmed Purchase order, you will specify Journal in this field.
Prompt when Specifying Vendor and Invoice Account

The Prompt when specifying vendor and invoice account parameter is used to activate a prompt in the Create Purchase order form. The parameter can be cleared or selected. Status Selected Description If you create a new Purchase order, or modify an existing one, you are prompted to copy vendor information base data, for example name and address for the vendor account number, or terms, for terms of payment, from the vendor's master record. Vendor information is copied to the Purchase order without a warning.
Cleared
EXAMPLE: Select the Prompt when specifying vendor and invoice account parameter so that master data can be confirmed for each order. For example, as the purchaser enters the vendor number, he or she can confirm that the address in the system for that vendor is current.
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Purchase Orders Prices/Amount
The Purchase Order Prices/Amount parameter controls whether the price is printed on the Purchase order document. The parameter can be cleared or selected. Status Selected Cleared Description Print the price of the items on the purchase lines on the Purchase order. No pricing information is printed on the Purchase order.
EXAMPLE: You may not want to display Purchase order prices for your vendor so that you do not hinder the possibility that the vendor will come back to you with a price offer lower than that printed on the Purchase order update.
One-Time Vendor Account

In the One-time vendor account field, select a vendor from which default settings originate for any one-time vendors that you create a Purchase order with the One-time vendor check box selected.
EXAMPLE: In the One-time vendor account field, specify vendor B2. When you create a new one-time vendor, details such as payment terms, mode of delivery, and other settings for vendor B2 default to the one-time vendor you have just created.
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Lab 3.2 - Applying Purchase Parameters

Contoso Entertainments System - Company CEU Scenario You are a Microsoft Dynamics AX 2009 implementer. You have been asked to visit the purchasing team at Contoso Entertainment Systems to provide additional training so that the team can take better advantage of their system. When arriving on site, you ask the team what they find time-consuming or cumbersome in their daily procedures. After some discussion, you learn that the team's work is cyclical: the first week of the month, they process Purchase orders; the second week of the month is when they process returns, and so on. Because this is the second week of the month, you will train them on how to set their system to default to creating Returned orders, and to eliminate the check for transferring vendor information. Because the Purchasing department wants to receive the best possible price offers from vendors, it is a policy that no pre-determined prices are printed on Purchase orders sent out to vendors. The company must frequently purchase from one-off vendors to compensate for the shortfall in supply from one of its regular vendors, vendor 8011. These vendors work with similar terms of payment, discounts systems, methods of delivery, and so on to vendor 8011. To facilitate the one-time vendor's setup in the Vendors table ensure that the base data template for one-time vendors is the same as for vendor 8011.
Challenge Yourself!
Set up the parameters to meet the requirements as outlined in the scenario.
Need a Little Help?

1. Find the parameters in Accounts payable > Setup > Parameters. 2. Select the General tab and change the appropriate fields.
Step by Step
1. From the Navigation pane, click Accounts payable > Setup > Parameters. 2. On the General tab, select Returned order as the Purchase type. 3. On the General tab, clear the Prompt when specifying vendor and invoice account check box. 4. On the General tab, clear the Purchase order/price amount check box.
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5. On the General tab, in the One-time vendor account specify vendor 8011 6. Close the Parameters form.
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Ship to Multiple Addresses

The Multiple ship to functionality enables users to specify delivery addresses per order line. Use the Multiple ship to functionality in Purchase orders to perform the following actions: Specify multiple receipt addresses for Purchase orders. Select if Purchase order documents are printed for each delivery address or for each order.
Specify an Alternative Delivery Address for a Purchase Order Line

Use the Alternative address functionality to specify another address for the Purchase order lines, for example, when you ask a vendor to deliver directly to a customer when you are not using the Direct delivery feature in Sales orders. On creation, the default delivery address on the Purchase order line is the delivery address from the Purchase order header.
Procedure: Specify an Alternative Delivery Address

To specify an alternative delivery address on a Purchase order line: Click Accounts payable > Purchase Order Details. Select a Purchase order. In the Lines section, select a Purchase order line. Click Setup and select Alt. address. In the Address selection form, click the appropriate tab and select the address in the lower pane that you want to copy to the Purchase order line. 6. Click Copy address to order. The address is now copied into the Purchase order line.
NOTE: You can use the Copy address from order button to upload an updated delivery address from the Purchase order line to the Address selection form for reuse later.
1. 2. 3. 4. 5.
HINT: If you only use the alternative address one time, it may be quicker to enter the address manually on the line.
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Procedure: Print a Separate Purchase Order Document for Each Delivery Address
To print a separate Purchase order update document for each address specified on the attached Purchase order lines: 1. Click Accounts payable > Setup > Parameters. 2. Click the Summary update tab. 3. In Split based on delivery information field group, select the Purchase order check box. Whenever you run a Purchase order update, documents are printed for each alternative delivery address.
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Lab 3.3 - Ship to Multiple Addresses and Purchase Orders

Contoso Entertainments System - Company CEU Scenario You will be receiving an order of 2,000 pieces of 1701 to two warehouses 21 and 22 on Site 2. The 1,000 pieces for each warehouse must be delivered to a different dock than usual because they must be stored in a warehouse area for fragile goods. Therefore, you must specify an alternative receipt address that is used for the fragile goods area at each warehouse.
Challenge Yourself!
Set up the Accounts payable parameters to split purchase order documents based on delivery information. Create a Purchase order with vendor 1203 for 2,000 pieces of item number 1701. Create the Purchase order with two lines so that 1,000 pieces each of the item are delivered to the alternative delivery address for warehouse 21, select any alternative address. For warehouse 22 you must enter an address manually on the Purchase order line.
Need a Little Help

1. Specify the alternative receipt address on the Purchase order line. 2. The print parameter can be found in Parameters for Accounts payable.
Step by Step
1. Open Accounts payable > Setup > Parameters > Summary update tab. 2. Select the Purchase order check box, and close the Parameters form. 3. Open Accounts payable > Purchase Order Details, and then create a new Purchase order with vendor 1203. 4. Create two Purchase order lines for 1,000 pieces of 1701, each a different warehouse specified for them, that is 21 and 22. 5. On the line with warehouse 21, specify an alternative address for the line by clicking Setup > Alt. address. 6. On the Warehouse tab, select an address line from the available addresses in the lower pane and then click Copy addr. to order.
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7. On the line with warehouse 22 you must enter the address manually on the Address tab of the lines section. 8. Click Posting > Purchase order and print the Purchase order documents.
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Purchase Order Posting

Microsoft Dynamics AX 2009 offers many posting techniques and processes that you can apply when you work with Purchase orders. In addition, posting profiles help you control which ledger accounts are used and when they are used when purchasing and selling inventory. When you post a Purchase order in Microsoft Dynamics AX 2009 update the order according to the stage it has reached in the order cycle. These stages include: Confirming order details Receiving items Invoicing
This lesson discusses the complete cycle of the Purchase order, explaining each step and its effect on other modules, such as Inventory management and General ledger. Notice that what is covered here is the most basic and simple cycle. More advanced functionality is available by using the Microsoft Dynamics AX 2009 Warehouse Management System (WMS) module, for example, for receiving and shipping orders. Profiles for posting to the general ledger can be set up for: One item An item group All items at the same time
Purchase Order Posting Update Types

Users can open the four posting updates that are available for Purchase orders in Microsoft Dynamics AX 2009 by using the Posting button on the Purchase order form. These updates are shown in the following table. Posting update Purchase order Receipts list Packing slip Invoice Description Confirms the Purchase order details. Prints the list of items and locations for the receiving staff to receive the items. Registers the item as received from the supplier using a packing slip. Registers the invoice as received from the supplier.
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You do not have to perform each Purchase order update for a given Purchase order. For example, the first two steps are optional. If you post the invoice without posting the packing slip, Microsoft Dynamics AX 2009 still posts the invoice and receives the item.
NOTE: Microsoft Dynamics AX 2009 also provides you with the option of using the Pro-forma button in the Purchase order form to go directly to the Posting forms for all posting updates, that will have the Posting check box inactivated by default.
BEYOND THE BASICS: When you use the Warehouse management functionality, the processing of Purchase order changes and the registering of item arrivals and receipts are performed in the Inventory management module journals. Refer to the Microsoft Dynamics AX 2009 Warehouse Management course for more information.
Post a Purchase Order

Post a Purchase Order discusses how to post a Purchase order and the various posting options, such as the quantity to be updated, summary updates and other options available when you perform the posting. After a Purchase order has been created, the next step is to perform Purchase order posting update. The Purchase order is posted to confirm the Purchase order details such as delivery dates, quantities, prices, and other order details, and to communicate them to the supplier by using fax or e-mail. All the default values for Purchase orders are set up in Accounts payable > Setup > Parameters.
Procedure: Quick-Post a Purchase Order

Follow these steps to quick-post a Purchase order: 1. Click Accounts payable > Purchase Order Details > Advanced view. 2. Select the Purchase order to post. 3. Click Posting > Purchase order. 4. Select All in Quantity field of the Posting dialog box. 5. Click OK button in Posting dialog box. Purchase orders can be posted multiple times; in this case Microsoft Dynamics AX 2009 stores each version of the Purchase order in a journal, by using revision numbers.
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Procedure: View Purchase Order Updates
Follow these steps to see the different versions of the Purchase order updates: 1. Click Accounts payable > Purchase Order Details. 2. Select the Purchase order where you want to see revisions. 3. From the Purchase order header, click Inquiries > Purchase order. The Purchase journal field shows the Purchase order number followed by the revision number, for example 00045_049-1, the 1 being the version suffix.
NOTE: Neither the Purchase order status nor the inventory transaction change when you update the Purchase order.
Update of Multiple Purchase Orders

From the Purchase order Advanced view, select more than one Purchase order in the Overview tab before you click the Posting button. This lets you update all the Purchase orders selected at the same time. You can also specify multiple Purchase orders for Purchase order update by specifying criteria in the Select query window opened from a specific Purchase order or from the Periodic folder. To perform this kind of multiple update: 1. Click Accounts payable > Purchase Order Details > Select a Purchase order > Posting >Purchase order. 2. Click the Select button. 3. In the query, select the Purchase order number, the Vendor account and the Purchase pool. 4. Click OK to confirm your selections.
Posting Purchase Order Form - Upper Panel

Users can access functionality from the upper panel, Parameters and Other tabs of the Posting Purchase order dialog box.
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In the upper panel of the Posting Purchase order form the Parameters tab has two field groups: Parameters Print options
FIGURE 3.5 POSTING PURCHASE ORDER FORM - UPPER PANEL
Upper Panel - Parameters Tab - Parameters

The Parameters field group contains the following fields: Quantity Posting Late Selection
Quantity
The Quantity field allows users to decide which quantity to post. The following table explains the options available in this field. Parameter Option Receive now Description Use when you are updating a partial quantity. The quantity must be entered on the order line on the Quantity tab. When the Purchase order is updated, the Receive now quantity on the Purchase order line is used as a proposed quantity. NOTE: You can also override this quantity in the Posting Purchase order form, and all other posting update forms by clicking the Lines tab and entering a quantity in the Update field. Select this option and the total Purchase order quantities are proposed in the posting lines. Use when you packing slip or invoice update a Purchase order. Only those items on the order that have been registered are updated. This is useful for posting only those items on the order that have been updated to the packing slip. The balance of the order will not be invoiced.
All Registered
Packing Slip
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Posting
Select the Posting check box to record the Purchase order revision in the journal. If you clear the check box, a pro forma Purchase order will be generated and this revision of Purchase order is not stored.
Late Selection
Clear the Late selection check box unless you plan to process the order at a later date or time by using a batch process. This is the only point in the Purchase order posting process that you have this option.
EXAMPLE: Late selection helps when a company wants to perform the printing of the purchase orders at a specific time in the day. They will create a regular batch job that runs all Purchase orders and prints or emails them at one time.
Upper Panel - Parameters Tab - Print Options

The Print options field group lets you select preferences for printing or viewing the posting. Select the Print purchase order check box to print a copy of the Purchase order update. Print Management By selecting the Use the print management destination parameter, you enable the print management system in Microsoft Dynamics AX 2009. Print management is used for purchase and sales order updating. Use Print management to specify: Which printer that will print specific updates. For example, set up the following: o o Print management on the form setup level to print the Purchase order at the purchaser's printer. The receipts list, to be printed at the warehouse printer so that the warehouse workers have a receipt list available for receiving the goods. The packing slip, to be printed at the goods receipt dock and a copy to be printed at the purchaser's own printer. The invoice original and copy are printed at the purchaser's printer. You can also specify settings for the specific order.
The number of original/copies to be printed. Notice that the destination and the number of copies/originals may be specified asynchronously.
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The print management settings are set up in a hierarchy, with each level overriding the one underneath. Therefore, in the following table, Form setup is the lowest level and the print management for the module overrides the form setup settings and so on up the hierarchy. Level Form setup Accounts payable Vendor Path Accounts payable > Setup > Forms > Form setup > Print management Accounts payable > Vendor details > select a vendor > Setup > Print management Accounts payable > Purchase Order Details > select a Purchase order > click Setup > Print management
Purchase Order
Procedure: Set Up Print Management from a Purchase Order

Use the following procedure to set up print management original or copy records and conditional settings for a Purchase order. You might do this if you must use a different printer for a specific transaction. 1. 2. 3. 4. Open Accounts payable > Purchase Order Details > Advanced Select a transaction. Click Setup > Print management. In the left pane, expand the list for a document that is listed under the transaction that you are working with. Any original or copy records are displayed.
NOTE: An icon with a blue arrow indicates that the original or copy record is inherited from the module level or account level of the hierarchy. This is the print management information that is used for the vendor, unless you make changes at the account or transaction level.
5. Review the original or copy record information. If changes are needed, you can override an inherited record, copy an inherited record, create a new record, or create a new conditional setting. 6. To override, right-click an original or copy record and select Override. The icon changes to display a red X to indicate that the record is now an override record. 7. To copy, right-click an original or copy record and select Copy. A copy is displayed in the list. You must give the copy a new name. 8. To create a new original or copy record, right-click a document in the list and select New. A new record is displayed in the list.
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9. To create a new conditional setting, right-click an original or copy record and select New. A new conditional setting is displayed in the list. You must give the conditional setting a description and select query information. 10. By default, the document will be sent to the default printer. To change the printer destination, select Printer setup in the Destination field and select a destination. When you have finished making changes, click OK to return to the Print management setup form. 11. Enter the number of identical copies to print. 12. Enter the footer text to include at the bottom of the document. To print footer text in other languages, depending on the language of the document, click the Footer text lookup button and set up footer text for the additional languages.
Upper Panel - Other Tab

The Other tab of the Posting purchase order form contains two parameters: Check credit limit Summary update for
The Check credit limit parameter does not come into effect until the first physical updates occur at Packing slip update. Therefore, this is documented in the section on Packing slip updates.
FIGURE 3.6 PURCHASE ORDER FORM - UPPER PANEL - OTHERS TAB
Summary Update Options

Use the Summary update for: field determines how multiple Purchase orders must be summarized. There are four summary update options shown in the following table. Type of update None Invoice account Description No summary updates are processed. One Purchase order journal will be created for each Purchase order. Use this selection to summarize multiple Purchase orders into one Purchase order update.
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Type of update Order
Description A selected range of orders are consolidated into one Purchase order update. When you select Order, another field, Purchase order appears. In this field, you select on which order the orders must be summarized. Notice that for orders to be summarized in this manner, they must fulfill the condition of by using the same currency and invoice account. If Order is selected, you must also set the Order error tolerance on the same form. Select this option to summarize multiple orders according to the criteria that is specified in the Summary update parameters. Specify in the order setup that a summary update must occur when the order is updated. Otherwise, the orders are posted separately.
Automatic summary
Automatic Summary
Before you can summary update Purchase orders by using Automatic summary, you must: Enable automatic summary updating for Purchase orders/vendors. Specify the parameters that determine how the automatic summary is performed, for example, by contact person, warehouse or other criteria.
Procedure: Set Up a Vendor for Automatic Summary Update

To enable automatic summary updating for a particular vendor you must specify that automatic summary updating is enabled for that vendor and in which updates, for example, on the Purchase order, Packing slip or Invoice update. To do this: 1. 2. 3. 4. Click Accounts payable > Vendor Details. Select for which vendor to enable summary updates. Click Setup > Summary update. Select on which updates to enable Automatic summary updates, for example, on Purchase and Invoice, but not for Packing slip or Receipts list.
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Procedure: Enable Automatic Summary Update for a Purchase Order
To enable automatic summary update for a specific Purchase order, where for example summary updating is not specified for the vendor generally, perform the following: 1. 2. 3. 4. Click Accounts payable > Purchase Order Details. Select a Purchase order. Click Setup > Summary update. Select the Use values from vendor check box if you want the settings from the vendor transferred to the order's summary updating settings. If you do not want to use the values from the vendor, clear the check box and select or clear the Automatic summary check boxes for the different updates.
Procedure: Set Up the Summary Update Parameters

Specify the criteria by which orders are summarized when you specify the Automatic summary updating method. The minimum parameters necessary to create summary updates are Invoice account and Currency; these parameters cannot be changed. 1. Click Accounts payable > Setup > Parameters > Summary update tab > click Summary update parameters. 2. Select the parameters to summary update by selecting the update type, that is as follows: o Purchase order o Receipts list o Packing slip o Invoice 3. Apply the parameters by clicking the parameters from the Available to the Selected pane.
Posting Purchase Order Form - Lower Panel

The lower panel of the Posting Purchase order form contains the Purchase orders to be posted.
NOTE: The Fixed assets tab will not be covered in the Microsoft Dynamics AX 2009 Trade and Logistics courses.
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FIGURE 3.7 POSTING PURCHASE ORDER FORM - LOWER PANEL
Example: Caution Triangle

Purchase orders have been selected for Purchase order update. In one of the Purchase orders, for ten pieces, the Receive now quantity was five. In the other Purchase order, there was no Receive now quantity specified on the line. The two Purchase orders were selected for update and the value in the Quantity field was Receive now. Therefore, the Purchase order where the line had a Receive now quantity was updated with a tick because there was a Receive now quantity to update. The other Purchase order had no Receive now quantity and there was nothing to update. Therefore, a caution triangle appeared.
Lower Panel - Setup Tab

The Setup tab displays the Document date, which uses the current system date if left blank. The Document date is used for calculating the due date and any cash discount date. The document date may be different from the system date in the following example.
EXAMPLE: The accounts payable clerk at Contoso Entertainment Systems was on sick leave during month-end processing and returned to work on July 3. However, all the invoices must have a posted date of some time in June. By using the Document date field on the Setup tab, the clerk can post the invoices in June.
Lower Panel - Lines Tab

The Lines tab displays all the lines for the selected Purchase order and lists the: Purchase order number Item number Site Inventory dimensions Quantity to update Financial value to be updated
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By clicking Inventory, you can access all the inventory views that can be accessed from the Purchase order line such as item on-hand, transactions and other information. Additionally, you can register item arrival from this sub menu.
FIGURE 3.8 POSTING PURCHASE ORDER FORM - LOWER PANEL - LINES TAB
Lower Panel - Line Details Tab

The Line details tab provides additional information about the item that is selected on the Lines tab. This additional information includes the following: Price Update and deliver remainder quantities Miscellaneous charges information Applicable discounts. Delivery address information
Lower Panel - Purchases Tab

The Purchases tab lists all the Purchase orders to be updated.
Post a Receipts List

Generating a Receipts list from a Purchase order does not change the status of a Purchase order or create any inventory transactions; it only provides a means for checking and validating shipments before accepting the order. The use of this function is determined by a business need and may not be a required process.
NOTE: A more advanced process for generating a receipts list is available in WMS functionality. See the Microsoft Dynamics AX 2009 Warehouse Management course for more information about WMS functionality.
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Scenario For the past six weeks, all the shipments Contoso Entertainment Systems have received from one of their suppliers have been incorrect: either items are missing, or extra items have been added. To address this situation, the receiving staff has decided to print a receipts list for all purchases from this supplier, and compare the shipment to the list before accepting the shipment.
Procedure: Post a Receipts List

Follow these steps to post a Receipts list: 1. Click Accounts payable > Purchase Order Details > Advanced view. 2. Select the Purchase order to post. 3. Click Posting > Receipts list. 4. In the Quantity field, select All. 5. Select the Print receipts list check box to print the receipts list. 6. Click OK. If you selected the Print receipts list check box, a receipt list that contains all the ordered items to be received is printed.
FIGURE 3.9 RECEIPT LIST REPORT
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The parameter and print options and the line details are the same as described in Post a Purchase Order.
Post a Packing Slip

The second to last step in updating Purchase orders is to receive the goods or services and to enter the packing slip into the system. This creates a physical inventory transaction and makes the items available. Record this transaction in the system by posting the packing slip. If all items on a given Purchase order are received, the Purchase order Status changes to Received.
EXAMPLE: You order 60 pieces of an item. You receive and register 40 pieces and packing slip update the order. The status in the Status field is Open order. You receive the final 20 items and packing slip update the order with the remaining 20 items. The Purchase order status now changes to Received.
Procedure: Post a Purchase Order Packing Slip

To post the packing slip, follow these steps: 1. Click Accounts payable > Purchase Order Details > Advanced view. 2. Select the Purchase order to post. 3. Click Posting > Packing slip. 4. In the Quantity field, select All. 5. Select the Print packing slip check box to print the packing slip. 6. Click OK.
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Posting Packing Slip Form
The Posting packing slip form contains two tabs: Parameters Other
FIGURE 3.10 POSTING PACKING SLIP FORM
Upper Panel - Parameters Tab

In the Quantity field drop-down of the Parameters tab, select how to packing slip update the quantities for a Purchase order. The options are as follows: Receive now, All, Registered and Packing slip. These are all described in Post a Purchase Order.
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The Posting check box determines whether posting must occur on updating. The table provides a description of the selection statuses. Selection status Selected Clear Description Post the packing slip. Creates a pro forma packing slip update. Use updates if you want to review the packing slip before you send it to the customer. When you perform an update no transactions are created for the Purchase order.
Specify settings in the Print options field group. The Print management option works the same as for Purchase order updating.

On the Other tab, indicate whether to use the summary update functionality. This is the same as in Purchase order update. Options included on the Other tab are: Check credit limit Credit correction Credit remaining quantity
FIGURE 3.11 POSTING PACKING SLIP FORM - UPPER PANEL - OTHER TAB
Check Credit Limit

Enter the check credit limit type and credit limits specified in Accounts payable > Vendor details > General tab, with vendors checked on Purchase order packing slip/invoice update. Select from the following options: None Balance Balance + Packing slip Balance + All
Of these options, Balance + All most likely offers the best obligations.
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Credit Correction and Credit Remaining Quantity
Select the Credit correction check box to display a credit note as a debit in your voucher transactions. This method is used in finance when a negative credit (debit) is used to correct an incorrectly recorded transaction.
NOTE: This kind of credit correction is also known as Storno.
If you are posting a credit note, select the Credit remaining quantity check box to keep the remaining quantity on order. If the check box is cleared, the remaining quantity is set to zero.
Lower Panel of the Posting Packing Slip Form

The lower panel of the Posting packing slip form consists of six tabs. The Fixed assets tab will not be covered in this course. Overview Setup Lines Line details Purchases
These tabs are used to view the details of the purchase orders and lines that will be posted.
Tab Descriptions
Overview Tab In the Overview tab you can review the details of the Purchase order to ensure that you are processing the correct Purchase order. When you perform a packing slip update, enter the vendor's packing slip number on this tab in the Packing slip field. Setup Tab On the Setup tab, enter dates in the Packing slip date and the Document date fields if it differs from today's date. Lines Tab Select the Lines tab to ensure that the items and quantities to be posted are correct. You can also specify whether a Purchase order line must be closed for additional updates by using the Close parameter. You can only close a line if the under delivery percentage for the line allows for closing.
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Line Details Tab View additional details such as miscellaneous charge, discount settings and other details on each item by clicking the Line details tab. If the quantities posted on the packing slip update equal the ordered quantities, the Purchase order status will change to Received. If there is a back order on one or more items, the value in the Purchase order Status field remains at Open order. Purchases Tab View the name of the purchase order.
Demonstration: Close a Purchase Order Line

This demonstration shows how a Purchase order line can be closed for additional updates by using the Close parameter. 1. Create a Purchase order for 100 pieces of 1701 for vendor 2001. 2. In the Purchase order line, on the Setup tab, in the Under delivery field, specify 60. This means that under delivery of 60% is accepted by the system. 3. In the Receive now field on the Quantity tab enter 60. 4. Click Inventory > Registration to register the 60 pieces. 5. Click Posting > Packing slip. 6. In the Quantity field, select Receive now. 7. In the Packing slip field, type 20. 8. In the lower pane, click the Lines tab. In the line you want to close for additional updates, select the Close parameter. 9. Click OK and notice that the purchase order has the status Invoiced.
Post a Purchase Order Invoice

The final step in updating Purchase orders is to invoice update the Purchase order when you receive the hard copy of the invoice from the supplier.
Procedure: Post a Purchase Order Invoice

To quick-post a Purchase order invoice, follow these steps: 1. 2. 3. 4. 5. 6. Click Accounts Payable > Purchase Order Details. Select the Purchase order to post. Click Posting > Invoice. In the Quantity field of Posting invoice form, select All. In the Invoice field, type the invoice number. Click OK.
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Posting Invoice Form
The upper panel of the Posting invoice form consists of several tabs in the upper and lower pane.
FIGURE 3.12 POSTING INVOICE FORM
Upper Panel - Parameters Tab

In the Posting invoice form, the upper panel of the Parameters tab contains parameters and print options. The Quantity field has four options. These work similar to the options for Packing slip update except for the Packing slip option. If you select Packing slip, the quantity invoice updated is the quantity that has been packing slip updated. Use this update if you only want to financially update the quantity received.
EXAMPLE: You have created a Purchase order for 50 pieces. Your supplier has delivered 20 pieces and you have packing slip updated the receipt of the 20 pieces. To keep this order financially updated, run an invoice update and select Packing slip in the Quantity field. Only the 20 received pieces are financially updated when you invoice update the order.
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Using the Packing slip option is an easy way to manage and invoice partial shipments because only the quantities that were updated to the order through the packing slip update will be picked up and brought into the posting. Clear the Posting field to print a pro forma invoice or select the check box to financially post the invoice. Adjust the print options in the Print options field group. Print options are the same as for the Purchase order update.

On the Other tab, specify if a credit check must be performed. The Check credit limit function works the same as described for packing slip updates.
FIGURE 3.13 POSTING INVOICE FORM - UPPER PANEL - OTHER TAB
Specify the summary update setting for purchase invoices. The Summary update function is especially useful, from a sales administration point of view, because it enables you to summarize orders in the system according to the way that you invoiced those orders.
EXAMPLE: A vendor sends you one invoice a month to cover for the multiple deliveries and purchase orders. By using the summary update functionality, you can update all Purchase orders at the same time instead of processing them individually.
Lower Panel - Overview and Setup Tabs

The lower panel of the Post invoice dialog box consists of two tabs: Overview and Setup. Overview On the lower panel, review the detail on the Overview tab to ensure that you are processing the correct Purchase order. Also use this tab to enter the vendor invoice number. Setup Enter information for use on the payment proposal generated by this update. The payment proposal is used when you process payments.
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The fields that are present on this tab are described in the following table.
FIGURE 3.14 POSTING INVOICE FORM - LOWER PANEL - SETUP TAB
Lower Panel - Fields on the Setup Tab

The Setup tab contain several fields: Posting Date: This is the transaction date for posting the invoice in the Ledger. It is used to calculate both the Due date and the Cash discount date, unless you fill in the Document date field. Approved: When selected, this means the invoice has been approved. This field is copied to the Accounts payable transaction. Only approved transactions are included in the calculation of the payment proposal. Approved By: This indicates who approved the invoice, as identified by their log on ID.
EXAMPLE: In some companies, approval limits are put on certain employees or employee roles; purchases more than 5,000.00 USD, for example. Therefore, invoices more than 5,000.00 USD will have to be approved by another employee who, based on business practices, becomes the approver. The approver's initials are included in this field.
Method of Payment: Use this to specify the method of payment for the vendor payment proposal. Payment Specification: Use this to specify payment handling for the current method of payment. Payment ID: The payment identification used for the payment of invoices. Bank Account: Specify the bank account to which the vendor wants you to send the payment for the order. The bank account ID is usually specified on the invoice that the vendor sends to your company.
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Specify the bank account on the vendor and the bank account details are automatically transferred to the Purchase order. Document Date: Specify the date the invoice was received. If you complete this field, the date entered will be used for calculating the due date and cash discount date. Due Date: Enter a due date to delimit the transactions in the proposal. Enter a different due date if the due date for payment differs from that specified in the regular terms of payment with the vendor for the Purchase order. This functionality helps if you want to bypass the standard due date calculation that was set up.
EXAMPLE: The purchaser has negotiated a special payment date for 100 pieces of an item with a vendor at the end of the next month. As this differs from the standard terms of payment of Current month+ 15 days that Contoso Entertainment Systems has with the vendor, the new due date must be entered in this field.
Fixed Rate: Select this field to indicate that a fixed exchange rate must be used. Exchange Rate: Specify an exchange rate for the invoice currency. This is editable only if you are by using a Fixed exchange rate instead of the system exchange rate.
Purchase Order Invoice Posting and Status

If the quantities posted on the invoice update equal the ordered quantities, the Purchase order status in the Status field changes to Invoiced. If there is a back order for one or more items, the Purchase order status remains Open order or Received.
NOTE: To delete Purchase orders or Purchase order lines, or both, after complete invoicing in Accounts payable > Setup > Parameters > Updates tab, select one or both of the following parameters: Delete Purchase order line invoiced in total Delete purchase after invoicing
Post an Invoice Based on a Packing Slip

You can create a Purchase order invoice based on the packing slip line items that have been received to date, even if all the items for a particular Purchase order have not yet been received. You might do this, for example, if your supplier sends one invoice for each month that covers all the deliveries that they ship during that month. Each packing slip represents a partial or complete delivery of the items on the Purchase order.
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When you post the invoice, the Invoice remainder quantity for each item is updated with the total of the received quantities from the selected packing slips. If both the Invoice remainder quantity and the Deliver remainder quantity for all items on the Purchase order are zero, the status of the Purchase order changes to Invoiced. If the Invoice remainder quantity is not zero, the status of the Purchase order is unchanged and additional invoices can be entered for it.
Procedure: Post and Print a Purchase Order Invoice Based on Packing Slips and Date
This procedure assumes that at least one packing slip has been posted for the Purchase order. The Purchase order invoice is based on these packing slips and reflects the quantities from them. The financial information for the invoice is based on the information that is entered when you post the invoice. 1. Click Accounts payable > Purchase Order Details. 2. Select one or more Purchase orders that have had packing slips posted for them. 3. Click Posting > Invoice. 4. In the Quantity field, select Packing slip. 5. Select the Posting check box. 6. Make selections in the Print options field group as needed. 7. On the Overview tab of the lower pane, select an invoice line and examine the Packing slip field. If an asterisk (*) is shown, multiple packing slips have been posted for this Purchase order. 8. Click the Select packing slip button, and review the list of packing slips in the upper pane Overview tab. By default, all posted packing slips for the Purchase order are included on the invoice. If the invoice you received from your vendor does not include some packing slips, clear the Include check box for those packing slips. 9. Click OK to close the Select packing slip form. 10. In the Invoice field on the Overview tab, enter the identifier of the invoice that you received from your vendor. 11. Click the Packing slip tab and verify that the values in the Purchase quantity and Quantity fields are correct. 12. Repeat steps 7 through 12 for additional Purchase orders, if it is necessary. 13. Click OK. The Purchase order invoices are posted and printed. 14. In the Purchase order form, you can view the status of the Purchase orders in the upper Overview tab. (Click Advanced to view the upper pane grid, if it is necessary.) In the lower Lines tab, select a line and then click the Quantity tab to view quantity information.
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Periodic Purchase Order Update
The Procedure: Post and Print a Purchase Order Invoice Based on Packing Slips and Dates can also be completed from the Invoice purchase update periodic job that is opened through Accounts payable > Periodic > Purchase order update. This procedure assumes that at least one packing slip has been posted for the Purchase orders that are invoiced by using the periodic job. The financial information for the invoices is based on the information that is provided when you enter and post the invoices.
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Lab 3.4 - Post a Purchase Order

Contoso Entertainments System - Company CEU Scenario You are the new purchasing clerk for Contoso Entertainment Systems and you are entering Purchase orders based on verbal requests. In five of the Purchase orders, you notice that the orders are with two vendors. Because one of your goals is to issue as few purchase invoices as possible, you summary update the orders by vendor. The Purchase orders are as follows: Three Purchase orders with Vendor account 2001, each for five pieces of item number 1701. Two Purchase orders with Vendor account 2002, each for five pieces of item number 1701.
Challenge Yourself!
1. Setup the parameters to support automatic summary update on the accounts payable parameters and the vendors. 2. Create the five purchase orders. 3. Purchase order update the five Purchase orders that you have created so that the Purchase order reports summarize the order by vendor.
Need a Little Help?

1. Set up the Accounts payable Parameters from Accounts payable > Setup > Parameters > Summary update tab. 2. Set up the Vendor(s) by using the Setup button in the Vendors form. 3. Create the purchase orders and mark them before posting the purchase orders.
HINT: Remove the default order settings on item number 1701 if you want to avoid a warning each time you enter 5 in the Quantity field of the purchase order line.
Step by Step
1. Click Accounts payable > Setup Parameters Summary update tab. 2. In the Default values for summary update field, click Automatic summary. 3. In the Order acceptance tolerance field, ensure that Accept is selected and then close the form.
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4. Click Accounts payable > Vendor details, and select Vendor account 2001. 5. Click Setup > Summary updates. 6. On the Purchase order, Packing slip, Receipts list, and Invoice lines, select the Automatic summary check box. 7. Repeat steps 5 and 6 for Vendor account 2002. 8. Click Accounts payable > Purchase Order Details. 9. Press CTRL+N to create a new Purchase order. 10. Select Vendor account 2001. 11. Click Yes in response to the prompt to transfer vendor information. 12. Click OK. 13. Select 1701 in the Item number field. 14. Type 5 in the Quantity field.
NOTE: If you have not removed the default order settings for item number 1701, you will receive a warning. Click No to override the default order settings and approve an order quantity of 5.
15. Tab off the field. 16. Repeat steps 9 through 15 for the remaining Purchase orders, by using the Vendor account 2002 for two of them. 17. Press SHIFT and then click the Purchase orders you just created, and then click Posting > Purchase order. 18. On the Parameters tab, in the Quantity field, select All. 19. Select the Posting check box. 20. Select the Print purchase order check box. 21. Click OK. 22. Close the report form. Two reports are generated, one for each invoice account.
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Accounts Payable Invoice Matching

Accounts payable invoice matching is the process of matching the vendor invoice, Purchase order, and packing slip information. Vendor invoices are frequently based on packing slips that represent actual shipments, instead of Purchase orders. Sometimes the invoiced amounts do not match the Purchase order amounts, and sometimes the shipped quantities do not match the invoiced quantities. To manage this information, Microsoft Dynamics AX 2009 enables you to do the following : Create an accounts payable invoice based on packing slips. Packing slips are automatically suggested for invoicing, and you can select which packing slips to use. You can also select specific packing slip line items from multiple Purchase orders, if it is necessary. Enter and save an invoice before a shipment arrives. After the packing slip that represents the shipment arrives, you can match the appropriate packing slip lines to the invoice lines. View and approve quantity differences between the invoiced quantity on the invoice and the received quantity on the packing slip. If there is a difference, you can save the invoice and then later match it to a different packing slip or change the invoice quantity to match the received quantity. Enter invoice amounts that were not included on the original Purchase order so that the invoice information matches the invoice vendor's. Compare the miscellaneous charges for Purchase orders with the miscellaneous charges for invoices. If it is necessary, you can add miscellaneous charges to invoices and allocate them to invoice lines. View and approve price match discrepancies between the invoice net unit price and the Purchase order net unit price. You can set up price tolerance percentages for companies, vendors, and items. If the vendor invoice line price is not within the acceptable price tolerance, you can save the invoice until it is approved for posting, or until you receive a correction from the vendor.
Example: Accounts Payable Invoice Matching

Alicia, the Purchasing agent, enters a Purchase order with one line item for one thousand batteries at a price of 1.00 U.S. dollar (USD) each. The Purchase order is approved and submitted to the vendor. The vendor ships one thousand batteries, and a packing slip is entered for one thousand batteries at a price of 1.00 USD each.
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An invoice arrives for one thousand batteries at a price of 1.10 USD each. The company policy allows a five percent price tolerance for this category of item. A price of 1.05 USD may be acceptable, but 1.10 USD is not. When the invoice information is entered, Microsoft Dynamics AX 2009 identifies that there is a price matching discrepancy and the invoice can be saved until the difference is resolved.
Set Up Accounts Payable for Invoice Matching

To set up Accounts payable parameters for invoice matching follow these steps: 1. Click Accounts payable > Setup > Parameters. 2. On the Updates tab, under the Invoice matching field group, select the Use invoice matching for this company check box. 3. In the Post invoice match discrepancies field, select to require approval before posting an invoice that contains invoice matching discrepancies. 4. In the Display price match icon field, select to display an icon only if there is a positive invoice matching discrepancy, or to display an icon if there is either a positive or negative invoice matching discrepancy.
Price Tolerance
Price tolerance information can be set up for all items, for item price tolerance groups, or for individual items.
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The figure, Item Price Tolerance Groups, is an example of a price tolerance group setup in Microsoft Dynamics AX 2009.
FIGURE 3.15 ITEM PRICE TOLERANCE GROUPS
Procedure: Set Up Item Tolerance Information

To set up item price tolerances by group, first the item price tolerance groups must be created and then each item must be assigned to the appropriate group. 1. Click Inventory management > Setup > Price/Discount > Item price tolerance groups. 2. Press CTRL+N to create a new item price tolerance group. 3. Enter an identifier for the item price tolerance group and a name. 4. Close the Item price tolerance group form. 5. Click Inventory management > Item details. 6. Select an item. 7. On the General tab, select an item price tolerance group.
Procedure: Set Up Vendor Price Tolerance Information

Price tolerance information can be set up for all vendors in your company, for vendor price tolerance groups or for individual vendors. To set up vendor price tolerances by group, the vendor price tolerance groups must first be created and then each vendor can be assigned to the appropriate group. 1. Click Accounts payable > Setup > Price/Discount > Vendor price tolerance groups. 2. Press CTRL+N to create a new vendor price tolerance group. 3. Enter an identifier for the vendor price tolerance group and a name.
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4. 5. 6. 7. Close the Vendor price tolerance group form. Click Accounts payable > Vendors. Select a vendor. On the General tab, select a vendor price tolerance group.
Set Up Price Tolerance Percentages

Price tolerance percentages can be set up for your company, items, and vendors. When vendor invoices are compared with Purchase order information, Microsoft Dynamics AX 2009 searches for the applicable price tolerance percentage in the order indicated in the following table. Item code Table Table Table Group Group Group All All All Account code Table Group All Table Group All Table Group All
The default company price tolerance is zero percent and is applied to all items and all accounts (All, All). You cannot delete the default company price tolerance record.
Example: Price Tolerance Percentage

You might set up the following price tolerance percentage records. Item code All Item relation Account code All Account relation Price tolerance percentage 1% Notes This percentage applies to all items and all vendors, unless one of the other scenarios applies. This is the company price tolerance percentage.
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Item code Table
Item relation Battery
Account code All
Account relation
Price tolerance percentage 1%
Notes This percentage applies to the Battery item from all vendors. This percentage applies to vendors who are assigned to the ten percent group, and All items.
All
Group
10 percent
10%
Procedure: Set Up a New Price Tolerance

To set up a new price tolerance, follow these steps: 1. Click Accounts payable > Setup > Price/Discount > Price tolerance setup. 2. In the first row, you can change the default company price tolerance. 3. Press CTRL+N to create a new price tolerance percentage. 4. Enter information about the item and vendor combination to which the price tolerance applies, and the price tolerance percentage.
NOTE: You cannot enter a negative price tolerance percentage. By default, Microsoft Dynamics AX 2009 enables negative price discrepancies. To track negative price tolerance percentages, select If line prices are greater than or less than allowed tolerance in the Display price match icon field in the Parameters form.
Posting Invoice Form

To record the receipt of vendor invoices and match against received quantities, use the Posting invoice form. If it is necessary, you can use the Invoice matching details form to view, correct, and approve invoice lines with matching discrepancies for posting.
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Posting Invoice Form - Overview Tab
FIGURE 3.16 POSTING INVOICE FORM
On the Overview tab, the columns shown in the following table are associated with the Invoice matching feature. Column Packing slip Description The packing slip that is associated with the invoice. If multiple packing slips are associated, an asterisk (*) is displayed. If selected, indicates that the invoice can be saved but not posted. For example, if there is a problem with the invoice, you might put it on hold while you contact the vendor and resolve the problem. When this check box is selected, the status of the invoice changes to Pending. NOTE: If the invoice has no line items, it is not saved, even if this check box is selected. Status The status of the purchase invoice. New: The invoice document has been created. Pending: The invoice document has been saved or put on hold but not posted.
On hold
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Column Match variance
Description Displays a check mark if the variance between the invoice net unit price and the Purchase order net unit price is within allowed tolerances for lines on the invoice, and if the invoice quantity and the packing slip quantity is equal for all lines on the invoice. Displays a warning icon if matching discrepancies exist; that is, if the price variance exceeds the allowed tolerance, or if the invoice quantity and packing slip quantity are different for one or more lines on the invoice. To view detailed information, click Matching details. This field is available only if the Use invoice matching for this company check box is selected in the Accounts payable parameters form.
Posting Invoice Form - Packing Slip Information

The packing slip number is displayed on the Overview tab and on the Packing slip tab, additional information about quantity is displayed. On the Lines tab, the two fields shown in the table present information about the difference between the packing slip and the invoice lines. Fields Packing slip quantity match Description Displays a check mark if the invoice quantity and the packing slip quantity are equal for the selected line. Displays a warning icon if the invoice quantity and packing slip quantity are different for the selected line. To view detailed information, click Matching details. This field is blank if the invoice line quantity is positive, the Receiving requirements check box for the item's inventory model group is cleared, and the invoice line is not connected to any packing slips. This field is blank if the invoice line quantity is negative, the Deduction requirements check box for the item's inventory model group is cleared, and the invoice line is not connected to any packing slips. Price match Displays a check mark if the variance between the invoice net unit price and the Purchase order net unit price is within allowed tolerances for the selected line. Displays a warning icon if the price variance exceeds the allowed tolerance for the selected line. To view detailed information, click Matching details.
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NOTE: Microsoft Dynamics AX 2009 does not match packing slips automatically unless Packing slip is selected in the Quantity field on the Posting invoice form.
Match Packing Slip to Invoice Form

When you click the Packing slips button, the Match packing slips to invoice form opens.
FIGURE 3.17 MATCH PACKING SLIP TO INVOICE FORM
The form displays all the lines items to the current invoice and from here you can match packing slips to the invoice you are working with. 1. In the Match packing slips to invoice form, select the Match check box for the packing slips to match with the invoice line items. 2. Or, click the Match all lines or Match all packing slips buttons to match all packing slips to the invoice. 3. Click OK to save the changes and return to the Posting invoice form.
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Record the Receipt of Vendor Invoices and Match against Received Quantities
When you receive an invoice from a vendor for goods or services on a Purchase order, your business processes might require that the goods or services be received before the invoice can be approved for payment. Use the Posting invoice form to enter invoice information. If it is necessary, you can use the Invoice matching details form to view, correct, and approve invoice lines with matching differences for posting. The Invoice matching details form is opened by clicking the Matching details button on the Posting invoice form. The Invoice matching details form displays all lines for the current invoice. For the line selected in the upper pane matching information on Price, Quantity, and Invoice totals is available. If Require approval is selected in the Post invoice match discrepancies field in the Accounts payable parameters form, another field group is available for the approver. The authorized approver can select the Approve posting with matching discrepancies check box to approve the invoice for posting and enter a comment if necessary. In the Posting invoice form, a check mark in the Variance approved column is displayed. Therefore, the variance for the specific invoice line is approved. If the column is blank, the variance for the line has not yet been approved.
NOTE: If the Matching details button is not available, you do not have access to the Invoice matching details form. In the Posting invoice form, you can select the On hold check box to save your work.
Resolve Invoice Matching Discrepancies

The information from the Invoice matching details form can be used to determine and resolve common types of price variances and quantity variances. This is collectively known as matching discrepancies. After identifying the discrepancy, you may have to contact your vendor if you believe that the information on the invoice is incorrect. Depending on the resulting agreement with your vendor, you can do any of the following tasks: Accept the price difference and post the invoice with matching discrepancies Revise the invoice amount to the expected amount and post the invoice Request a full credit from the vendor and a new corrected invoice
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Resolve Price Variances
If the invoice net unit price exceeds the Purchase order net unit price by an amount that exceeds the allowed price tolerance, a price variance exists. The price variance might be because of different prices for each unit, purchase price units, line item discounts, miscellaneous charges that are allocated to the invoice lines, or a combination of these factors.
Procedure: Resolve a Price Variance

To resolve price variances, follow these steps: 1. 2. 3. 4. 5. 6. 7. Click Accounts payable > Purchase Order Details. Select a Purchase order that has a pending (saved) invoice. Click Posting > Invoice. The Posting invoice form opens. Click Matching details. Select an invoice line for which a warning icon is displayed. Review the information in the Price field group. To accept the price difference and post the invoice with matching discrepancies, select the Approve posting with matching discrepancies check box, enter a comment, and then click OK. To revise the invoice amount to the expected amount, change the amounts in the Invoice column to match the amounts in the Purchase order column, and then click OK. In the Posting invoice form, on the Overview tab, clear the On hold check box. On the Parameters tab, select the Posting check box. Click OK to post the invoice, or you can submit the invoice to be posted by using batch processing.
8.
9. 10. 11.
NOTE: If the Post invoice match discrepancies field in the Accounts payable parameters form is set to Allow with warning, these fields are not available and you must skip step 7.
Resolve Quantity Variances

If the Receiving requirements check box is selected for an item's inventory model group, a packing slip must be posted before an invoice can be posted for the corresponding line item. Also, the Update quantity on the packing slip line must equal the Update quantity on the invoice line.
Procedure: Resolve a Quantity Variance

To resolve quantity variances, follow these steps: 1. Click Accounts payable > Purchase Order Details. 2. Select a Purchase order that has a pending (saved) invoice.
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3. 4. 5. 6. 7. Click Posting > Invoice. The Posting invoice form opens. Click Matching details. Select an invoice line for which a warning icon is displayed. Review the information in the Quantity field group. To accept the quantity difference and post the invoice with matching discrepancies, select the Approve posting with matching discrepancies check box, enter a comment, and then click OK.
NOTE: If the Receiving requirements check box is selected for the item's inventory model group, and if the packing slip quantity is less than the invoice quantity, the invoice cannot be posted even if it is approved.
Procedure: Revise Packing Slip Quantity to Match Invoice Quantity

To revise the packing slip quantity to match the invoice quantity, follow these steps: 1. Click the Total packing slip matched ellipsis button. 2. Select a different packing slip that has the correct quantity for the invoice line, and close the form. 3. Click OK to close the Invoice matching details form.
Procedure: Revise Invoice Quantity to Match Packing Slip Quantity

To revise the invoice quantity to match the packing slip quantity, follow these steps: 1. 2. 3. 4. 5. 6. 7. Note the quantity in the Total packing slip matched field. Click OK to close the Invoice matching details form. In the Posting invoice form, click the Lines tab. Select an invoice line and change the quantity in the Update field. On the Overview tab, clear the On hold check box. On the Parameters tab, select the Posting check box. Click OK to post the invoice.
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Purchase Order Financial Posting

Users can set up General ledger account numbers for the automatic ledger transactions generated for receipt and issues of inventory. You may specify whether the account must be used for a specific item, for an item group, or for all items.
Inventory Posting Profile - Purchase Order

Posting profile setup is important when you determine how the system handles ledger posting when an inventory transaction is posted. Posting profiles are set up in Inventory management > Setup > Posting > Posting or in the Item group by Item group.
FIGURE 3.18 INVENTORY POSTING PROFILE - PURCHASE ORDER TAB
Microsoft Dynamics AX 2009 lets you set up general posting rules for all items, accounts, and sales tax codes. You can define primary posting in Accounts payable Parameters for receipt and discounts.
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Inventory Posting Profile - Posting Hierarchy
Microsoft Dynamics AX 2009 searches for an item in a hierarchy. In the Item code field, select from: Table: This is the highest in the hierarchy. By selecting Table, the posting in the ledger only applies to a specific item number. Group: If selected, the posting in the ledger only applies to a particular item group. All: If selected, every transaction is posted for all item numbers in the same account in the ledger. The first matching account will be used for posting.
You can specify a Vendor group in the Account relation field and add it to the posting hierarchy. Based on your type of business , you must decide which accounts must be set up.
Purchase Order Packing Slip Posting

When Purchase orders are packing slip updated and inventory is received, and then transactions based on the item's cost as recorded in the purchase line are generated in the Packing slip account, and the Packing slip offset account. For this posting to occur, you must select certain parameters: Post physical inventory parameter in the item's inventory model group. Post packing slip in ledger in Accounts payable > Setup > Parameters > Updates tab.
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Example: Purchase Order Posting
The following diagram, Purchase Order Posting Example, shows Purchase order posting activity in Microsoft Dynamics AX 2009.
FIGURE 3.19 PURCHASE ORDER POSTING EXAMPLE
This is a receipt scenario. When you packing slip update the Purchase order the packing slip account is debited and the packing slip offset account is credited. When the Purchase order is invoiced the last posting is reversed and the inventory receipt account is debited and the accounts payable is credited.
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Purchase Order Discount Posting

If an account is specified in the Discount account, the purchase posts before the line discount is deducted, and the line discount is credited in the separate account for discounts. If no account is specified for the line discount, the inventory receipt is posted after the line discount is deducted, and the latter is not recorded directly in a ledger account.
FIGURE 3.20 PURCHASE ORDER DISCOUNT POSTING
Purchase Order Consumption Account Posting

The Consumption account is used for credit notes and purchases if you have cleared the Post financial inventory field.
FIGURE 3.21 PURCHASE ORDER CONSUMPTION ACCOUNT POSTING
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BEST PRACTICE: Clear the Post financial inventory and Post physical inventory parameters for a Service item type to use the Consumption account.
Receipt Account Posting

The receipt accounts, also known as Inventory accounts, are used to post inventory. For items using fixed receipt price, the item's adjustment of price on receipt is debited through the following accounts: Fixed receipt price profit Fixed receipt price loss Fixed receipt price offset
Any tax is debited in the Tax code account and item purchases, including tax, are credited to the Vendor summary account according to the setup in the supplier's Posting profile.
Standard Cost Posting

For items using a standard cost Costing method, transactions are made based on the current active cost. The difference between the actual cost and the current active cost is posted to the Purchase price variance account that is set up on the Standard cost variance tab on the Posting profile. Learn more about Costing methods in the Microsoft Dynamics AX 2009 Costing and Inventory Valuation course.
Charge and Stock Variation

Charge and Stock variation enables you to post stock movement through a profit and loss account before capitalizing it in inventory. This offers the benefit of having a footprint in the profit and loss account of the stock variation occurring during a fiscal period.
Packing Slip Purchase, Purchase Offset and Tax

When you use the Packing slip purchase, Packing slip purchase offset, and Packing slip tax posting types to accrue vendors receipts, eventually the projected tax will be separated from received and not yet invoiced.
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Summary
Purchase Orders and Purchase Order Posting reviewed how to use the basic Purchase order functionality and how to perform posting updates to Purchase orders through all the posting updates. The following areas were covered: Creating Purchase orders. Setting up parameter settings for Purchase orders. Using the Multiple ship to function for Purchase orders. Using the Accounts payable invoice matching function for Purchase orders. Applying Purchase order updates and the various posting options when you update the Purchase order. Using Ledger integration and the different account types that you can post to when you perform posting.
Learning about Purchase orders and Purchase order posting helps you create basic Purchase orders in Microsoft Dynamics AX 2009. Additionally, learning about the more advanced purchase features helps to: Set up multiple receipt addresses for orders. Perform Purchase order invoice matching and solving discrepancies when they occur. Control what is posted and when. Optimize the number of updates you have to perform.
Additionally, learning about how posting integrates to the ledger helps you determine how item transactions are posted, the account types that are used and how the specific setup of accounts affects how the business records revenue and costs.
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Test Your Knowledge

Test your knowledge with the following questions. 1. In which module(s) are Sales and Purchase order posting profiles set up?
2. Sales order and Purchase order posting is set up based on what hierarchy?
3. What is the purpose of the Sales and Purchase Posting profiles?
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4. Name five of the accounts you can set up in Purchase order posting profile setup.
5. What does it mean to Packing slip update a Purchase Order?
6. What must you select in the Quantity field of the Posting invoice form to match packing slips automatically in Microsoft Dynamics AX 2009? ( ) All ( ) Receive now ( ) Registered ( ) Packing slip
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7. What are the receipt accounts also known as?
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2.
3.
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Solutions
Test Your Knowledge
1. In which module(s) are Sales and Purchase order posting profiles set up? MODEL ANSWER - Inventory management 2. Sales order and Purchase order posting is set up based on what hierarchy? MODEL ANSWER - Item, Table Item group, Group All items, All 3. What is the purpose of the Sales and Purchase Posting profiles? MODEL ANSWER - These determine how the system handles ledger posting when an inventory transaction is posted. 4. Name five of the accounts you can set up in Purchase order posting profile setup. MODEL ANSWER - Packing Slip, Packing Slip Offset, Receipt, Consumption, Discount, Standard cost profit, Standard loss, Standard cost price offset, Charge, Stock Variation, Packing Slip Purchase, Packing Slip Purchase Offset, Packing Slip Tax 5. What does it mean to Packing slip update a Purchase Order? MODEL ANSWER - Inventory is received and physically updated. 6. What must you select in the Quantity field of the Posting invoice form to match packing slips automatically in Microsoft Dynamics AX 2009? ( ) All ( ) Receive now ( ) Registered () Packing slip
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7. What are the receipt accounts also known as? MODEL ANSWER - Inventory accounts.
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Chapter 04: Serial and Batch Numbers
CHAPTER 4: SERIAL AND BATCH NUMBERS

Objectives
The objectives are: Set up an items dimension group to allow for serial and batch number allocation. Allocate serial and batch numbers manually to an item. Set up an item to automatically have batch and serial numbers allocated. Use a transfer order to edit serial and batch numbers. Use the trace inventory dimension function to track an item's inventory dimensions.
Introduction
Serial and batch numbers provide companies with the ability to trace their products through Microsoft Dynamics AX 2009. The numbers are used for: Tracing purposes Quality assurance Warranties
Traceability is useful for quality assurance purposes and when you deal with warranties for a product. The tracing functionality is especially important for items representing a certain risk, such as medicine or chemicals, where defects in production can lead to the item recall. It is equally important for guaranteed items to be able to trace back to the date that the product was manufactured or sold. Serial and batch numbers allow for this kind of functionality. You can assign serial numbers, batch numbers, or both to an inventory item. Serial numbers are assigned to individual items, where batch numbers are assigned to a set of items.
NOTE: Lot ID is the term that refers to a transaction, and not an item dimension such as serial and batch numbers. A Lot ID is assigned automatically to each sales or purchase line when you create it. The number is taken from the number sequence associated with the number sequence reference Lot No. in the inventory parameters. You cannot make transactions without a Lot ID being assigned unlike using batch numbers, which you can either select to use or not.
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Dimension Group - Storage Dimensions

Serial and batch numbers are inventory storage dimensions, and can be allocated to items only when the items inventory dimension group allows for it. This figure, Inventory dimensions, shows the Inventory dimension groups form located in Inventory management > Setup > Dimensions > Dimension groups. Notice that the Batch Number and Serial Number dimensions are set to Active in the Storage dimensions - activation and setup pane. If these Inventory dimension groups are assigned to items, these items can then be assigned batch and serial numbers.
FIGURE 4.1 INVENTORY DIMENSIONS
Serial Number Control

Serial numbers in Microsoft Dynamics AX are not necessarily unique and this means that you can use the same serial number on two identical inventory items.
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To ensure that only one inventory item can be allocated a given serial number, you must activate the Serial number control in the Dimension group. It is not a good idea to use manual allocation when you work with a controlled item that requires maximum traceability.
FIGURE 4.2 SERIAL NUMBER CONTROL PARAMETER
Procedure: Set Up Unique Serial Numbers

To ensure that serial numbers are unique, follow these steps: 1. Click Inventory management > Setup > Dimensions > Dimension groups. 2. Create a new dimension group for which you want to control the serial numbers. 3. On the Storage dimensions pane, activate the dimension Serial numbers and select the check box Primary stocking. 4. When the line is highlighted, click the General tab and select the Serial number control check box. 5. Specify other parameters for the Dimension group and close the form.
NOTE: Changes to the dimension values can only be made until a transaction is made with the Dimension group.
Manual Allocation
Serial numbers can be manually or automatically assigned to items on receipt. Use manual allocation of serial and batch numbers if you want to trace the items back to the vendor. For example, when you receive chemical or medical items, ensure that you continue the use of the serial and batch numbers provided by your vendor so you can fully trace and recall defected items throughout the supply chain.
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Serial Numbers
Manual allocation of serial numbers requires that you set up the Inventory dimension group and a serial number for the specific item from the Serial number form. The Serial number form is used to create or edit serial numbers for an item number. As soon as a serial number is set up and associated with an item in this form, you can assign the serial numbers manually. Open the Serial number form from Inventory management > Inquiries > Dimensions > Serial numbers
Assign Serial Numbers

You can manually assign a serial number to an item when: Working on an item directly on a sales or purchase order line Registering the items at the time of item arrival
For Serial numbers, you can type any number directly on the line in the Serial number field. However, to have better control of the serial numbers used for each item, create the serial numbers for an item number in the Serial numbers form. This is illustrated in the Demonstration: Create and Assign Serial Numbers to an Item.
HINT: If serial numbers are assigned automatically, then the serial numbers entered on purchase or production order lines will not be updated to the Serial numbers form. However, if the items are manually allocated and have serial number control checked in the Inventory dimensions form, the new serial number on the purchase or production order form will be updated to the Serial numbers form on physical update.
Demonstration: Create and Assign Serial Numbers to an Item

In this demonstration you will create serial numbers LT-1001, LT-1002, and LT1003 and link them to item 160310. For this demonstration, first create an item to use. The specific setup of the item is shown in the following table. Field Number and Name Item group Inventory model group Dimension group Selection 160310 Projectors FIFO N-WS
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1. Open the Serial number form from Inventory management > Inquiries > Dimensions > Serial numbers. 2. In the Item number field select the item 160310. 3. In the Serial number field type the serial number LT-1001. The Manufacturing date field is optional, if you want to note the manufacturing date of the serial number. 4. Repeat steps 2-3 to assign all the serial numbers to the items. Use serial numbers LT-1002 to LT-1003. 5. Press CTRL+S to save and then close the window. Now the serial numbers for 160310 are created and you can select them for the items on the purchase order line.
Demonstration: Allocate Serial Numbers on a Purchase Order Line

This demonstration shows how to select the created serial numbers for item number 160310 on the purchase order line. 1. Create a purchase order for one piece of item number for vendor 1101 - Rain Projectors 2. Set the quantity to 1 and select a serial number, that you created earlier, on the line and save the purchase order.
NOTE: The serial number that is specified in the Serial number field on the purchase order line is assigned to all items on the line. Therefore, if you set the quantity to five, all five items have the same serial number unless Serial number control is selected in the Inventory dimension group.
After serial numbers have been assigned, the numbers for the individual inventory transactions can be found in the Serial number field on the order lines.
Procedure: View the Inventory Transactions Form

View the inventory transactions and the serial number allocated to the transaction with one of two methods: Open the Purchase order form through Accounts payable > Purchase Order Details, and then click Inventory management > Transactions. Open the Items form through Inventory management > Item details, and then click Transactions.
NOTE: To view serial and batch numbers on the posting updates for purchase orders you must specify the document setup in the Form setup form. To set up the forms for purchase order click Accounts payable > Setup > Forms > Form setup. The setup is performed on the relevant tab for the document.
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Demonstration: Manually Allocate Serial Number on Registration
This demonstration shows how to manually allocate serial numbers through registration on receipt. Contoso Entertainment Systems has purchased three pieces of item number 160310, (the item created in the previous demonstration). All received items must be serialized by either the supplier or on receipt. This item will not have serial numbers provided by the vendor: therefore, the purchasing agent will define the numbers as the items are registered. 1. In the Purchase order form, create a new purchase order for three items 160310 for vendor 1001 and send the items to warehouse 21. 2. Click Inventory > Registration. 3. In the Transactions pane, select the warehouse 21 on the line and select the Auto-create box. Notice that the transaction now appears in the Register Now pane. 4. Click the Create serial numbers button and insert the format for the serial number, for example Serial##, in the Create serial numbers form.
NOTE: When you enter the serial number, use the pound # sign to indicate how many digits you want to appear in the serial number. The minimum amount of pound signs in a serial number is as many as the number of digits in the item quantity.
5. Click OK and notice that serial numbers are given to each line in the Register now pane according to the selected format in the Create serial number form. 6. Click the Post all button and the Receipt status for the transactions in the Transactions pane changes to Registered. 7. Close the Registration form. To verify that each item on the line has unique serial numbers when you have posted the purchase order, click Inventory > Transactions in the Purchase order form to view the transactions.
NOTE: The Create Serial numbers button always creates unique serial numbers. If you want to have serial numbers with a different quantity, type serial numbers by hand on the Transactions /Register now pane and use split functionality; or use a number group to auto-create serial numbers with a fixed quantity other than one unit.
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Demonstration: Manually Allocate Serial Number on Registration Using Split
Contoso Entertainment Systems manufactures speakers. One of the components of their ten most popular speakers is item number 160310 (the item that you created earlier). Since Contoso Entertainment Systems uses so many of item number 160310, they order them in quantities of 1000 pieces, and upon registration, split them into five sections of 200 items by assigning five number rows. Each item is assigned serial numbers with different formats including the manufacturer's identification, to support full traceability. 1. In the Purchase order form, create a new purchase order for 1000 pieces of item 1603100 from vendor 1101. 2. Click Inventory > Registration. 3. In the Transactions pane select the warehouse 21. 4. Click Split. 5. Specify the quantity 200 in the Split quantity field and then click OK. 6. Repeat steps 4 and 5 three times. 7. Select the Auto-create check box for each line. Notice that the transactions now appear in the Register Now pane. 8. Highlight a line and then click Create serial numbers. Type the format Serial1### and then click OK. Repeat this for the other lines, but with the formats Serial2###, Serial3###, Serial4### and Serial5###. 9. Click Post all and close the Registration form 10. In the Purchase order form, continue the posting of the order as usual. To verify that each item on the line have the appropriate serial number, open the Transactions form from Inventory > Transactions.
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Batch Numbers
A batch number must be created before it can be assigned to an item. Unlike serial number assignment, a batch number cannot be entered directly in the Batch number field on the order line; it must be created in the Batch number form and then selected from the line in either the sales or purchase order.
FIGURE 4.3 BATCH FORM
Open the Batch form from Inventory management > Inquiries > Dimensions > Batches
Demonstration: Manually Create Batch Numbers for an Item

Contoso Entertainment Systems has received a shipment of ten item number 800130, transformers. The company wants to track these transformers as a batch so that they can compare the maintenance requirements of these transformers to those transformers purchased from another manufacturer. For this demonstration, first create an item to use. The specific setup of the item is shown in the following table. Field Number and Name Item group Inventory model group Dimension group Selection 800130, Transformer RM FIFO N-WB
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1. Click Inventory management > Inquiries > Dimensions > Batches. 2. Press CTRL+N to create a new line. 3. In the Batch number field enter a batch number of your choice, for example Batch 01. The Manufacturing date and Expiry date field are optional. 4. In the Item number field select the item 800130. 5. Press CTRL+S to save and close the window.
Demonstration: Manually Allocate Batch Numbers on the Line

Now that a batch number is created for item 800130, it is possible on the Purchase order line to select the batch number. To verify this: 1. Create a Purchase order for the item 800130 for vendor 1101 2. Select a site and warehouse and specify 10 in the Quantity field. 3. In the Batch number field on the line, select the batch number that you have created. 4. Post the order as usual.
NOTE: You can open the Batch number form by right-clicking in the Batch number field on the order line and selecting Go to the Main Table Form.
Demonstration: Manually Allocate Batch Number on Registration

Contoso Entertainment Systems has received an order of 100 item number 800130 transformers, that will be used to create five types of items. Upon receipt of the order, the system will split it into five batches of 20, each with a distinct batch number. To do this: 1. Open the Purchase order form and create a new purchase order for 100 items of 800130 for vendor 1101. 2. Click Inventory > Registration. 3. In the Registration form split the order by clicking Split in the Transactions pane. 4. Specify the quantity 20 to split in the Split Quantity field and then click OK. Continue splitting until there are five transactions each with 20 items in the Transactions pane. 5. Select the already created Batch numbers for each transaction and select the Auto-create box. 6. Click Post all in the Register now pane and the receipt status in the Transactions pane changes to Registered. 7. Close the Registration form and in the Purchase order form continue posting the order as usual.
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To verify that all batches have the correct batch numbers, click Inventory > Transactions to view the transaction for this order.
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Lab 4.1 - Set Up an Item with Manual Allocation of Serial Numbers

Scenario You are a purchasing agent for the Contoso Entertainment Systems. Contoso Entertainment Systems has purchased ten item number 160320, Lab DLP Projector, from Rain Projectors. These items must be serialized manually on receipt with unique serial numbers and the serial numbers must be updated to the Serial number form. As the purchasing agent, you will define the numbers while registering the items. The number will have this format: DLPP.###.
Challenge Yourself!
Create the item 160320 and set it up according to the specifications in the scenario Use Item group = Projectors, and Inventory model group = FIFO, Dimension group = N-WS Upon receipt, register the items with unique serial numbers After the items are received from the supplier, view them in inventory
Need a Little Help?

1. Create the item from Inventory management > Item details. 2. Create the purchase order from Accounts payable > Purchase Order Details. 3. After specifying the quantity, click Inventory > Registration to create and assign the serial numbers. 4. Remember to use the Auto-create check box. 5. After posting, view the items and serial numbers in Inventory > Transactions.
Step by Step
Create an item in the Items form: 1. Click Inventory management > Item details. 2. Press CTRL+N to create a new item. 3. Type the Item number 160320, and the Item description Lab DLP Projector. 4. TAB to the Item group field, click the arrow, and then select Projectors. 5. Click the General tab.
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6. Click the Inventory model group field, click the arrow, and then select FIFO. 7. Click the Dimension group field, click the arrow, and then select NWS. 8. Close the form. Create a purchase order, register the items received, and invoice update the order: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. Click Accounts payable > Purchase Order Details. Press CTRL+N to create a new purchase order. In the Vendor account field, select vendor 1101 (Rain Projectors). Click Yes in answer to the prompt about transferring vendor information. Click OK. Select 160320 in the Item number field. In the Quantity field, type 10. In the Warehouse field, select 21. Click Inventory > Registration. In the Registration form, select the Auto-create check box for the line. Click the Create serial numbers button; the Create serial numbers dialog box will appear. Type DLPP.### in the Format field. Click OK. Click the Post all button and close the Registration form. In the Purchase order form, click Posting > Invoice. In the lines, type 15 as the Invoice number. Click OK.
To view the inventory transactions, click Inventory > Transactions in the Purchase order form.
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Automatic Allocation
Use Automatic allocation when, for example, a company holds the production itself and there is no vendor involved. In this case, the serial numbers can be generated and automatically allocated to the items. To automatically allocate serial or batch numbers, a Number group must be created and assigned to the item. Serial and batch numbers can be assigned to several items, sequentially from the same number group.
Procedure: Create a Number Group

To create a Number group, follow these steps: 1. Click Inventory management > Setup > Dimensions > Number groups. 2. Press CTRL+N to create a new line. 3. Specify the number group and a descriptive name. 4. Press CTRL+S to save. To each new number group a default setting is applied. However, modifications can be made on the General tab and the Activation tab. On these tabs you define how and when automatic number allocation must occur.
Number Groups Form - General Tab

The General tab of the Number groups form consists of two field groups that you must set up before using the number group. Structure Activation
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FIGURE 4.4 NUMBER GROUPS FORM - GENERAL TAB
Structure Field Group

The structure of the automatic serial and batch number is controlled from the specifications shown in the following table. Field Date Reference No. Description Select to include the date (Year/Month/Day) in the serial or batch number. Select if you want the reference number (for example the purchase order or production number) in the serial or batch number. Select to include the inventory lot number (Lot ID.) in the serial or batch number. The inventory lot number is used to automatically keep track of all inventory transactions. Select to include the number sequence specified in the next field in the serial or batch number. Select the appropriate number sequence to use.
Lot No.
Number sequence No. Number sequence
NOTE: The Batch and Serial number fields can contain only 20 characters. If you must use all the options in this table, you may have to modify the Batch and Serial number fields to accept more characters.
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Allocation Field Group
In the Allocation field group, specify when and how the automatic number must be assigned. The parameters are shown in the following table. Field Manual Description Select to assign manual serial and batch numbers to the items that are associated to this number group. Select to assign the generated numbers to the transaction, instead of, for example, the purchase order line. The serial and batch numbers are generated and assigned when a Purchase order is created. The numbers cannot be viewed from the purchase order line. However, one transaction is listed in the Transactions form, with one serial or batch number. Select to assign the generated number when an item transaction is made. This means that the Serial and Batch numbers are not generated until a packing slip and a picking list registration is posted. The serial numbers cannot be viewed on the purchase order line. However, one transaction is listed in the Transactions form with one serial number. Specify the quantity of items to be assigned to the generated number. To assign unique serial numbers and batch numbers type 1 in the Per Qty. field. The Only for inventory transactions check box must be selected for this field to be active.
Only for inventory transactions
On physical update
Per Qty.
Example: Allocation Settings

If the Only for inventory transactions check box is selected, 25 is specified in the Per qty. field and a purchase order is made for sixty items; three batch or serial numbers are generated when the purchase order is created. Twenty five items are assigned the first batch or serial numbers, another twenty five items are assigned the second batch or serial number and ten items are assigned the third serial number.
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Notice that if the Serial number control check box is selected in the Dimension group for an item, an error will appear if you try to post the packing slip with an item if, for example, 2 is specified in the Per Qty. field for the Serial number group.
NOTE: If you do not select any of these fields, one batch or serial number is assigned to the purchase order line when a new order is created and saved.
Number Groups - Activation Tab

To complete the set up of the number group, specify in which modules the number assignment will be automatic. This is completed on the Activation tab.
FIGURE 4.5 NUMBER GROUPS FORM - ACTIVATION TAB
There are four activation choices in the Activation tab, as shown in the following table. Field Order activation Description Select to enable automatic number allocation in the Accounts receivable module. This will also generate new numbers when items are returned by credit notes. Select to enable automatic number allocation in the Accounts payable module.
Purchase activation
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Field Inventory activation
Description Select to enable automatic number allocation in the Inventory management module. For example, you discover five items in your warehouse that are not in the inventory. To add the items to the inventory, make a Profit/Loss journal for the five items. When the Profit/Loss journal is posted, the items are allocated serial numbers according to the settings on the General tab in the Number group form. Select to enable automatic number assignment in the Production module.
Production activation
HINT: The typical setup is to have all except Order activation selected, because you do not want to enable the change of serial numbers when a return action is performed.
Procedure: Assign a Number Group to an Item

To assign a number group to an item, follow these steps: 1. Open the Items form through Inventory management > Item details. 2. Select the item for which you want to assign a number group and select the General tab. 3. In the Groups field group, select the number groups for either serial or batch numbers in either the Serial number group field or Batch number group field. You can use the same number group for both serial and batch numbers.
Updating Serial and Batch Numbers

Serial and Batch numbers can be updated if necessary. When entering an inventory dimension on a receipt transaction, you can change the value by using a Transfer journal. A change of inventory dimensions causes a movement of onhand inventory from one dimension to another.
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Lab 4.2 - Set Up an Automatically Allocated Serialized Item

Scenario As a purchasing agent at Contoso Entertainment Systems, you are responsible for setting up serial numbers. Looking at the purchasing schedule for the week, you see that one of your colleagues will be placing a large order for a new inventory item, 160325 (Serialized Projector Auto) , which must be serialized.
Challenge Yourself!
1. For your first task, create the Number group . The serial number must be automatically allocated to the items on physical update. Also, the serial number must be unique to each item and generated from the Number sequence Acco_19. 2. Create and set up the item number 160325. 3. To test your work, create a purchase order for vendor 1101 (Rain Projectors) for five pieces of the new item, from Warehouse 21, Packing slip number 12. The details are highlighted in the following table. Field Number group (Number) name Item number Item name Item group Inventory model group Dimension group Value SerialUniq Unique Serial Numbers 160325 Serialized Projector Auto Projectors FIFO N-WS
Need a Little Help?

1. Number groups must be set up before automatic allocation of serial numbers can occur. 2. Number groups are set up in Inventory management > Setup > Dimensions > Number groups. 3. Items are created and set up in Inventory management > Item details. 4. The purchase order is created in Accounts payable > Purchase Order Details.
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Step by Step
Create a number group: 1. Click Inventory management > Setup > Dimensions > Number groups. 2. Press CTRL+N to create a new number group. 3. In the Number field, type SerialUniq. 4. In the Name field, type Unique Serial Numbers. 5. Click the General tab and select the Number Sequence No. check box. 6. Clear the Date, Reference No., and Lot ID check boxes. 7. Click the arrow in the Number sequence field and select Acco_19. 8. Select the Only for inventory transactions check box. 9. Select the On physical update check box. 10. Type 1 in the Per Qty. field. 11. Close the Number groups form. Create and set up the item in the Items form: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Click Inventory management > Item Details. Press CTRL+N to create a new item. Type 160325 in the Item number field. Type Serialized Projector Auto in the Item name field. TAB to the Item group field, click the arrow, and then select Projectors. Click the General tab. Click the Inventory model group field, click the arrow, and then select FIFO. Click the Dimension group field, click the arrow, and then select NWS. Click the Serial number group field, click the arrow, and then select SerialUniq. Close the Items form.
Create a purchase order: 1. 2. 3. 4. Click Accounts payable > Purchase Order Details. Press CTRL+N to create a new purchase order. In the Vendor account field, click vendor 1101 (Rain Projectors). Click Yes in answer to the prompt about transferring vendor information. 5. Click OK. 6. Click the arrow in the Item number field, and then select 160325. 7. Click the arrow in the Warehouse field, and then select 21.
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8. 9. 10. 11. 12. TAB to the Quantity field, and type 5. Click Posting > Packing slip. Select All in the Quantity field. Type 12 as the Packing slip number. Click OK.
View the inventory transactions: 1. Click Inventory > Transactions. 2. Close the Transactions form.
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Tracing
Traceability, for many companies, is necessary for quality assurance purposes and for dealing with product warranties. The tracing functionality is especially important for items representing a certain risk, such as pharmaceuticals or chemicals, where errors in production can lead to a recall of the items. It is equally important for companies to be able to trace items with a guarantee back to the date that the product was sold.
Trace Inventory Dimensions

The Tracing function is available throughout Microsoft Dynamics AX 2009. This feature is used to track inventory dimensions throughout the application in one window and shows related receipts and issues for a transaction with a treegraphic. The trace inventory dimension function not only traces serial and batch numbers, but also provides details of all other dimension values associated with the item. You can run a trace inventory dimension from either: The purchase order line, by clicking the Inventory button and selecting Trace The sales order line, by clicking the Inventory button and selecting Trace The Items form, by clicking the Transactions button and then in the Transactions on item form click Inventory and select Trace.
Trace Inventory Dimensions Form

In the Trace inventory dimensions form, the parameters for tracing are specified. Also, users can change the Item number, Lot ID, and Dimension number by clicking the Select button.
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When the report is run, the result of transactions displays in a tree-graphic. The Format field shows the format for the transactions.
FIGURE 4.6 TRACE INVENTORY DIMENSIONS FORM - TREE TAB
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Trace Inventory Dimensions Form - Setup Tab
On the Setup tab, you can set the parameters for what is displayed on the Tree tab.
FIGURE 4.7 TRACE INVENTORY DIMENSIONS FORM - SETUP TAB
Select the check boxes according to the descriptions in the following table. Field group Display options Line Description Select which parameters to display for each transaction on the Tree tab. Make a selection in the Forward or backward field to see where the items have been used (Forward), or to trace the supply of the items (Backward). Select the Date check check box to list inventory dimensions by date. Select which parameters to trace by.
Trace by
Procedure: Trace a Serial or Batch Number

From either the Serial number or Batch number form you can trace on a specific number. This can be useful if, for example, you receive a customer complaint on an item and you want to trace that specific item by using the serial or batch number to determine from which vendor the item was received, and when.
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1. Click Inventory management > Inquiries > Dimensions. 2. Select Batches or Serial numbers, depending on what numbers you want to trace. 3. Look up the number you want to trace and then click the Trace button. 4. In the Trace inventory dimensions form, specify the options by which you want to trace and then click OK. 5. Double-click a receipt or issue from the result list to see the transactions for the specific item. 6. Right-click in the Number field in the Transactions form and select Go to the Main Table Form to see the original sales or purchase order form for that particular item and transaction.
Scenario: Using the Trace Function

Contoso Entertainment Systems has purchased 100 pieces of Definition DVD players, item number 1707, from vendor Ruby Electronics. When the items are received by Contoso Entertainment Systems, each is assigned a unique serial number. After several days, 70 of the DVD players are sold. One month later, Ruby Electronics contacts Contoso Entertainment Systems to tell them they are recalling the item 1707 because they are defective. Contoso Entertainment Systems uses the tracing function to see who purchased the item 1707 from them so that they can recall the defective transformers and have them replaced by Ruby Electronics.
Procedure: Using the Trace Function

1. Click Accounts payable > Purchase order. 2. Locate the purchase order that you want to trace, and then click the Inventory > Trace. 3. In the Trace inventory dimension form, select the criteria Site, Warehouse and Serial number in the Trace by field group. This means that these dimensions will be shown on the Trace report. 4. Click OK and each serialized item is displayed together with the relevant Purchase order and future Sales order it is tied to. 5. Double-click an item to see the transactions for the specific item. 6. From the Transactions form, call the specific Purchase order or Sales order by right-clicking in the Number field, where the purchase or sales order is specified, and selecting Go to the Main Table Form. Notice that the same steps apply when you want to trace from the sales order to determine which purchase orders the items are related to.
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In addition, you can use the Trace function to determine which serialized items or batches of items that have been used on a production. This is important for quality control and if the company must recall a product because of a defective part.
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Lab 4.3 - Trace Items

Scenario Contoso Entertainment Systems has purchased item number 1501 from Rain Projectors. Later, the quality assurance department at Rain Projectors recognizes a defect in one of their LCD Video Projector model 1, and orders every item from purchase order number: 00021 recalled. Contoso Entertainment Systems has already sold the items onward to other customers. Therefore, to recall the items they must determine to whom the items were sold.
Challenge Yourself!
Your task is to execute the Trace function and answer the following questions in order to be able to recall the items: On which sales orders are the items sold? To which customer is the item number 1501 on purchase order 000021 sold to on the first sales order?
Need a Little Help?

1. The Trace function, for this lab, must be executed from the purchase order. 2. Run a trace on the purchase order lines for item 1501 on Purchase order 000021 3. Double-click a transaction in the Trace inventory dimensions form to access the information that you want. 4. Right-click on the sales order number and go to main table, to access the original sales order.
Step by Step
1. 2. 3. 4. 5. 6. 7. 8. Click Accounts payable > Purchase Order Details. Locate the purchase order 000021. Select the first purchase order line for item number 1501. Click Inventory > Trace. Click OK to open the Trace inventory dimensions tree. Expand a transaction and double-click the issue transaction. Note the sales order number in the Number field. In the Sales order form, note the Customer account number, or you can hover over the Sales order number in the Transactions form to see the customer account for the sales order.
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Summary
Serial and batch numbers provide companies with the ability to trace their products through Microsoft Dynamics AX 2009. You can assign serial numbers, batch numbers, or both to an inventory item. Serial numbers are assigned to individual items, where batch numbers are assigned to a set of items. Serial and Batch Numbers reviewed how to set up and work with serial and batch numbers, and how to trace inventory dimensions.
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Chapter 5: Item Arrival and Registration
CHAPTER 5: ITEM ARRIVAL AND REGISTRATION

Objectives
The objectives are: Set up registration requirements for incoming items. Set up the Arrival overview form and start, register and update item arrivals.
Introduction
Item Arrival and Registration introduces the features that support receiving items in a company. In addition, it will cover how to perform the following tasks in Microsoft Dynamics AX 2009: Set up requirements to registration before you add an item in to inventory. Set up the Arrival overview form. Perform item arrival.
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Item Registration Setup

Microsoft Dynamics AX 2009 can be set up to enable the requirement that users record the item number, configuration, quantity, and dimensions, before recording a physical update. This is useful when a company wants to ensure that batch numbers, or serial numbers are recorded at arrival so that they can be tracked through inventory. A company may also want to ensure that the status of the incoming items are described enough to give another user outside the warehouse good information about the whereabouts of an item.
Inventory Model Group

The Inventory model group controls the item's registration requirements. This is located at Inventory management > Setup > Inventory > Inventory model groups.
FIGURE 5.1 INVENTORY MODEL GROUP FORM - GENERAL TAB
Set up and maintain the settings for the Inventory model group on the Setup tab. The fields in the Physical update field group determine the workflow used when you send or receive items. With these you can set rules around how an order is handled, both for receiving and shipping. The Receiving requirements and Registration requirement check boxes affect the registration process when receiving items.
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Registration Requirements
In the Registration requirements check box, users can select whether item receipts must be registered before inventory is physically updated. When it is selected, the status of the item receipt inventory transaction must be Registered before the item's packing slip is updated. The Registration requirements parameter is generally used with warehouse management. Registered items are part of physical inventory. You can register items in the Warehouse management journals, or by clicking Inventory > Registration on the relevant journals and orders.
Receiving Requirements
When the Receiving requirements check box is selected, users must physically update the item receipts before financially updating them. In addition, users must enter and post a packing slip before posting the corresponding vendor invoice. If there is a difference between the received quantity on the packing slip and the invoiced quantity on the invoice, an icon shows in the Packing slip quantity match column in the Posting invoice form.
Item Arrival
In Microsoft Dynamics AX 2009, the Arrival overview form is introduced to improve the overview of items expected to arrive as incoming goods. The Arrival overview form is a tool to estimate and plan the resource capacity that is required to efficiently handle incoming goods. Scenario Sammy, who is responsible for shipping and receiving, needs a good overview of the expected incoming items, including when to expect them. When items arrive, he can efficiently match the information that arrives with the items to the receiving information in the system.
Arrival Overview Form

The Arrival overview form provides an overview of items that are expected to arrive and about the date they are expected to arrive. When items arrive in the inbound dock, the Arrival overview form is used to match the information accompanying the items with the information in Microsoft Dynamics AX 2009. The settings in this form can be saved for each user and for each computer so that users can have their personal settings on computers put in the inbound area. One user can have multiple setups.
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The Arrival overview form is opened through Inventory management > Periodic > Arrival overview
FIGURE 5.2 ARRIVAL OVERVIEW FORM
The Overview tab consists of four main sections: Display options - specify or filter on what receipts to display in the Arrival overview form Receipts field group - provides an overview of the expected receipts, grouped by date, warehouse, and order number Lines field group - for the selected receipt, a detailed list of expected receipt lines Totals information - an overview of the totals for the lines selected with the Select for arrival check box and for all lines in progress
Arrival Overview Form - Filter Options

In the Display options field group, a user can filter on, for example, expected arrivals on a specific day for one or more warehouses.
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This kind of filtering must be specified under the Range field group. A user can filter on: Date range Warehouses Vendor reference Account number Item number Mode of delivery RMA number
There are four predefined filtering templates that can be selected in the Setup name field on the Setup tab: Today: Filters on all receipts expected today Inquiry: An empty template to specify all the necessary filtering or to use with the bar code scanner. Options used: Default filtering that cannot be overwritten or deleted. Return order: Return orders
NOTE: The filters Today and Inquiry are default filters with suggested settings. However, these two filters can be renamed or changed by the user.
The filter is applied to the Lines pane and the Receipts pane is automatically updated. The Receipts pane displays the order headers and the Lines pane displays the lines attached to the selected order header. When an order header is selected, all lines in the order are displayed in the Lines pane. This includes lines that do not fall under the selected filter. These lines are marked Out of range. Example A purchase order has been created for two items going to two warehouses: Warehouse1 and Warehouse2. When a user filters on Warehouse1 in the Arrival overview form, the Receipts pane displays the purchase order header, and the Lines pane displays the line for both Warehouse1 and Warehouse2. However, the line for Warehouse2 is marked as Out of range and will therefore not be included when the user starts the arrival.
NOTE: In fields like Warehouses or Vendor reference under the Range field group, more than one name can be entered if separated with a comma.
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Arrival Overview Form - Settings
On the Setup tab of the Arrival overview form, more setups can be specified for what is displayed on the Overview tab.
FIGURE 5.3 ARRIVAL OVERVIEW FORM - SETUP TAB
The settings on the Arrival overview form are described in the following table. Setting Restrict to site Journal field group Description Restrict the display to one site. Define which journal name to use and assign warehouse and location to use as default values on the journal lines. A journal name must be specified; if warehouse and location is not specified, the information from the inventory transaction is used. Define if the form will update automatically when it is opened and if updates must be automatic when the values are changed. Define which transaction types to show in the list of receipts. Select a specific setup in the Setup name field to which you want to make changes, delete, or copy. Include return orders.
Miscellaneous field group
Transaction types shown field group Maintenance
Return orders
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NOTE: The settings on the form are automatically saved as the default under the name Options used when the form is closed.
The settings in the Arrival overview form can be saved for each user and for each computer so that users can have their personal settings on each computer put in the inbound area. The options are defined and saved under a user-defined name on the Setup tab. Example When Sammy, who is responsible for shipping and receiving, arrives at work every morning, he wants to view all the expected receipts from production to warehouse GW for the current day to establish a good overview of the day's work. Instead of performing the same filtering every morning, he sets up the Arrival overview form one time with the necessary settings and saves them in a new template called Production. Also, Sammy wants this to update on startup of the Arrival overview form.
Procedure - Create a New Template

To create a new template for the settings on the Arrival overview form to support the example, follow these steps: 1. Open the Arrival Overview form. 2. On the Overview tab, specify zero (0) in both the Days back and Days forward fields. This means that the list filters on the current day. 3. Specify a warehouse. 4. Click the Setup tab in the Arrival overview form. 5. Specify the settings for the template. According to the earlier example with Sammy: o Select the check box Update on startup in the Miscellaneous field group. o Select the check box Production orders in Transaction types shown field group. 6. Click the Modify... button and then Save as. 7. Specify, in the Save form, the name of the new template Production, and then click OK. 8. Now the new template Production is available in the Setup name drop-down list on the Arrival Overview form. When Production is selected, all expected production receipts for the current day are listed.
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Procedure - Copy Settings
To copy the setup from other user's settings, follow these steps: 1. Click the Setup tab in the Arrival overview form. 2. Click the Modify button and then Copy setup from other user's settings. 3. In the Copy setup from other user's settings form, specify the name Company, User ID, Computer name, and Setup name for the template you want to copy. 4. Click Copy.
NOTE: The settings in the Range field group on the Overview tab are also saved as part of the setup.
Managing Item Arrivals

When a company manages the arrival of items to the inbound dock, several separate tasks will typically be performed by different users, such as viewing and starting expected arrivals. View Expected Arrivals The warehouse manager, or the person responsible for receiving goods, first needs an overview of the expected arrivals so that he or she can plan the work and assign tasks to individual warehouse workers. Start Arrivals When the goods arrive in the inbound dock, the warehouse manager or the warehouse worker verifies the information on the paperwork accompanying the goods and compares it with the information in Microsoft Dynamics AX 2009. Each delivery that has been matched with an order can be pre-registered so that it shows that the receipt is in progress.
Procedure - View Expected Arrivals

View the expected arrivals with the following steps: 1. Click Inventory management > Periodic > Arrival overview to open the Arrival overview form. 2. Use the options on the Overview tab to filter on the expected arrivals that you want to have listed in the Arrival overview form. 3. Click the Update button to update information that is shown in the form, depending on the ranges used. The Receipts pane now shows arrivals that are expected on or before the current date.
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Procedure - Start an Item Arrival
To start an item arrival, you can follow these steps: 1. Click Inventory management > Periodic > Arrival overview to open the Arrival overview form. 2. Use the options in the Range field group to filter on the information supplied with the goods, for example the Vendor reference. 3. In the Receipts pane or Lines pane, select the Select for arrival check box for the relevant lines and then click the Start arrival button. Multiple arrivals can be selected and started at the same time. Microsoft Dynamics AX 2009 now selects all related lines within the specified range having a missing quantity to register, and generates an Item arrival journal with the corresponding match between receipt reference and journal. They system will create all lines by using the automatic initialization of quantity.
NOTE: An arrival journal must be selected in the Name field on the Setup tab of the Arrival overview form before you generate arrival journals.
TIP: Use the link in the InfoLog to go directly to the created journal.
Procedure - Register Arrivals

When the goods in the inbound dock are being moved to the designated warehouse, the warehouse manager will register the arrival of the goods in Microsoft Dynamics AX 2009, in arrival journals. 1. Click Inventory management > Periodic > Arrival overview to open the Arrival overview form. 2. Select the receipts for the arrival that is to be registered and then click Journals > Show arrivals from receipts. Or, select Show arrivals from lines to see the lines that have been created in an arrival journal. 3. In the Location journal form, select a journal and then click Lines to see detailed information. 4. Make the necessary updates, for example the quantity information, and the click Post to complete the registration.
Procedure - Update Arrival Information and Post a Packing Slip

When all goods have been registered, the warehouse manager or the purchasing manager will update the received items with a packing slip to add the physical cost.
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To update arrival information and post a packing slip, follow these steps: 1. Click Inventory management > Periodic > Arrival overview to open the Arrival overview form. 2. Click Packing slip ready journals to display a list of the journals that are ready for packing slip update. 3. Select the journals that must be updated and then click Functions > Packing slip to open the Posting form. 4. Type the packing slip number, if not already done on the journal, and then click OK to post the packing slip.
NOTE: If anything is specified within the Range field group on the Overview tab of the Arrival overview form, these specifications are also considered when the system is finding the packing slip ready journals.
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Lab 5.1 - Manage an Item Arrival

Contoso Entertainment Systems - Company CEU Scenario You are a warehouse worker at Contoso Entertainment Systems and you want an overview of the expected arrivals so that you can plan today's work. When the goods arrive in the inbound dock, you will verify the information on the paperwork accompanying the goods and compare it with the information in Microsoft Dynamics AX 2009. You will pre-register an order so that it shows that the receipt is in progress.
Challenge Yourself!
1. Create a purchase order for one piece of item number 1552, Installation manual for projectors, for arrival today from vendor 1101. 2. View the expected arrivals for today. 3. Start the item arrival. 4. Register the receipt of the item. 5. Update the vendor packing slip information and post the packing slip.
Need a Little Help?

1. Create the purchase order in Accounts payable > Purchase Order Details 2. Use the Arrival overview form to start and register the item arrival. 3. Post the packing slip from the Arrival overview form.
Step by Step
Create the Purchase order: 1. 2. 3. 4. 5. Open Accounts payable > Purchase Order Details. Click CTRL+N, and select Vendor account 1101 Click Yes to transfer vendor information, and then click OK Select 1552 in the Item number field Click the General tab, and update the Delivery date field to today's date. 6. Close the Purchase order form.
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View the expected arrivals for today: 1. Click Inventory management > Periodic > Arrival overview to open the Arrival overview form. 2. Type 0 in the Days back field 3. Type 0 in the Days forward field. 4. Click the Update button to update information that is shown in the Arrival overview form. Start the item arrival: 1. In the Receipts pane or Lines pane, select the Select for arrival check box for the relevant lines, and then click the Start arrival button. Register the receipt of the items: 1. Select the receipts for the arrival that is to be registered and then click Journals > Show arrivals from receipts. Or, select Show arrivals from lines to see the lines that have been created in an arrival journal. 2. In the Location journal form, select a journal and click Lines to see detailed information, and then close the Lines form. 3. Click Post to complete the registration. Post the packing slip: 1. Select the line that you want to post. 2. Click Packing slip ready journals to display a list of the journals that are ready for packing slip update. 3. Select the journal that must be updated and then click Functions > Packing slip to open the Posting form. 4. Type 5 in the Packing slip number field, and then click OK to post the packing slip.
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Summary
Item Arrival and Registration discussed the following topics: Registration requirements and the setup in the Inventory model group. Item arrival procedures and how to set up a view in the Arrival overview form.
Item arrival and registration is useful when a company wants to ensure that items are tracked at the first entry in to the warehouse to give the warehouse manager or personnel a good overview of their daily tasks, and a one stop point of contact in Microsoft Dynamics AX 2009 to start, register and update item arrivals.
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Test Your Knowledge

Test your knowledge with the following questions. 1. "Today" is one of the predefined filtering templates that can be selected in Arrival Overview form. What is filtered when this filter template is applied? ( ) All receipts of purchase orders that were created today ( ) Default filtering that cannot be overwritten or deleted ( ) All receipts expected today ( ) Return orders 2. Which parameter do you select if you want to ensure that a packing slip is entered and posted before a vendor invoice? ( ) Registration requirements ( ) Receiving requirements ( ) Picking requirements ( ) Deduction requirements
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2.
3.
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Solutions
Test Your Knowledge
1. "Today" is one of the predefined filtering templates that can be selected in Arrival Overview form. What is filtered when this filter template is applied? ( ) All receipts of purchase orders that were created today ( ) Default filtering that cannot be overwritten or deleted () All receipts expected today ( ) Return orders 2. Which parameter do you select if you want to ensure that a packing slip is entered and posted before a vendor invoice? ( ) Registration requirements () Receiving requirements ( ) Picking requirements ( ) Deduction requirements
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Chapter 06: Quarantine Management
CHAPTER 6: QUARANTINE MANAGEMENT

Objectives
The objectives are: Set up a warehouse for quarantine management Set up an item to be automatically quarantined by setting up the required parameters Create and process a manual quarantine order. Set up automatic quarantine management. Split, return and scrap part of the order in the quarantine order process. Identify the inventory transactions associated with the statuses of a quarantine order.
Introduction
Quarantine Management, which is part of the Inventory management module, introduces how Microsoft Dynamics AX 2009 uses Quarantine orders to control the item location of incoming items for quality control. Items can be set aside in a quarantine warehouse to await either manual or automatic approval, depending on setup. Manual quarantining can be used, for example, when an item must be set aside for quality reasons. Automatic quarantining can be used for perishable items where, for example, the expiration dates must always be checked before the items enter the standard warehouse.
NOTE: When the items are in quarantine they are not available in inventory and cannot be picked from inventory for a delivery.
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Quarantine Warehouse Setup Parameters

To enable the manual or automatic quarantine of an item, you must create a warehouse to hold the quarantined item. In Microsoft Dynamics AX 2009, there are three types of warehouses, which are described in the following table. Warehouse Type Default Transit Quarantine Description Where items are typically received into and issued from Used for transfer orders between warehouses Where items are kept to be quality controlled, until they are released for use
Procedure - Set Up a Quarantine Warehouse

To use quarantine orders, you must create a quarantine warehouse and attach it to the default warehouse.
NOTE: The quarantine warehouse must be associated with the same site as the current warehouse.
To create a quarantine warehouse, follow these steps: 1. Open Inventory management > Setup > Inventory breakdown > Warehouses. 2. Create a new warehouse by pressing CTRL+N. 3. Specify the name. 4. In the Type field, select Quarantine. 5. Select a site. 6. Press CTRL+S to save.
Procedure - Attach a Quarantine Warehouse to a Default Warehouse

Attach the quarantine warehouse to a default warehouse (or warehouses). Microsoft Dynamics AX 2009 will then send quarantine items bound for this default warehouse, to the specified quarantine warehouse. To attach the new quarantine warehouse to the default warehouse, follow these steps: 1. Select the default warehouse on the Overview tab. 2. Click the General tab. 3. Select the quarantine warehouse in the Quarantine Warehouse field. 4. Press CTRL+S or close the form to save.
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NOTE: If an item to be quarantined is stored in a warehouse that has no quarantine warehouse linked to it, Microsoft Dynamics AX 2009 stops updating and notifies you with an error message that there is no quarantine warehouse specified.
Quarantine Parameters
There are two groups attached to an item that affect how the item can use quarantine management: Inventory model group Dimension group

Inventory model groups contain settings that determine how items are controlled and handled on item receipts and issues. The Inventory model group can be accessed from Inventory management > Setup > Inventory > Inventory model groups.
FIGURE 6.1 INVENTORY MODEL GROUP FORM - SETUP TAB
Within the inventory model group, there is a Quarantine management field on the Setup tab that must be selected to have quarantine orders automatically generated for the items of this group. You must clear this field to manually generate quarantine orders.
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NOTE: If an item to be quarantined is subject to registration requirements (if this box is also selected in the Inventory model group), you must register it in the standard inventory before it can be put in the quarantine inventory. This is because the automatically generated Quarantine order removes the item from the standard inventory to put it in the quarantine inventory.
Dimension Group
Inventory dimensions control how items are stored and withdrawn from inventory. The Dimension groups form can be accessed from Inventory management > Setup > Dimensions > Dimensions groups. When Inventory dimensions are set up, the storage dimension Site and Warehouse must be selected for the item's dimension group. It is also required that this is a primary stocking, meaning that you must enter the dimensions before any physical update. To do this, select the Primary stocking check box for Warehouse and Site on the Overview tab in the Dimension group form.
NOTE: The Site dimension is mandatory and will automatically be assigned primary stocking.
FIGURE 6.2 DIMENSION GROUP FORM
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In summary, for an item to use quarantine management, the attached inventory model group must be set up to use Quarantine management and the item's inventory dimension group must have the storage dimension Warehouse and Site selected.
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Lab 6.1 - Create Quarantine Inventory

Contoso Entertainment Systems - Company CEU Scenario You are the purchasing agent for the Contoso Entertainment Systems. You must buy a new item number 800120, Q.AG.test, for Site 2, Warehouse 21. However, it is very important to control quality of each item received for a certain time. You must create the new item and attach it to a new Inventory model group, QGRP, that you must create and set up for quarantine managed items. Create a purchase order for ten items of Q.AG.test for vendor 4301, Site 2, and warehouse 21.
The item to create has the following specifications: Field Inventory Model Group (Inventory Model Group) Name Item number Item name Item group Dimension group Value QGRP Quarantine Inventory Group 800120 Q.AG.test RM N-N
Challenge Yourself!
1. Create and set up a new Inventory model group for quarantine managed items. 2. Create the new item. 3. Attach the new Inventory model group to this item. 4. Create a purchase order for ten pieces of item number 800120 for vendor 4301, and post the packing slip. 5. Verify that the items are stored in a quarantine warehouse.
Need a Little Help?

1. Create a new Inventory model group. These are created in Inventory management > Setup > Inventory > Inventory model group. 2. Select the Quarantine management check box in the Inventory model group. 3. Create a new item and attach the new inventory model group. Do this from Inventory management > Item details. When you create the new item, use the new Inventory model group.
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4. When you create a purchase order for ten pieces of item items of 800120, select site 2, and warehouse 21 which is a warehouse that has a Quarantine warehouse attached to it. 5. To verify that the items are stored in the quarantine warehouse, click Inventory > Transactions on the purchase order line and then click the Inventory button and select On hand or Transactions for dimensions.
Step by Step
Create an inventory model group: 1. Click Inventory management > Setup > Inventory > Inventory model group. 2. Press CTRL+N to create a new Inventory model group. 3. In the Inventory model group field, type QGRP. 4. In the Name field, type Quarantine Inventory Group. 5. Click the Setup tab and select the Quarantine management check box. 6. Accept all other default values and close the form. Create a new item and attach the new inventory model group: Click Inventory management > Item details. Press CTRL+N to create a new item. In the Item number field, type 800120. In the Item name field, type Q.AG.test. TAB to the Item group field, click the arrow, and select RM. Click the General tab, click the Inventory model group field, click the arrow, and select QGRP. 7. In the Dimension group field, click the arrow, and select NN. 8. Close the form. Create a purchase order to verify the settings: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Open Accounts payable > Purchase Order Details. Press CTRL+N to create a new Purchase order. Click Vendor account 4301. Click Yes to transfer vendor information. Click OK. Click the Item number arrow and select item number 800120. In the Site field, select 2, and in the Warehouse field select 21 In the Quantity field, type 10. Click Posting > Packing slip. Select All in the Quantity field. 1. 2. 3. 4. 5. 6.
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11. Specify the packing slip number and then click OK. 12. Open Inventory management > Periodic > Quality management > Quarantine orders. 13. Verify that the quarantine order for ten items of 800120 is started in the Quarantine orders form.
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Quarantine Item Management

To manage items to be quarantined, Microsoft Dynamics AX 2009 follows a three step procedure by using the Quarantine order form. Transactions are created for the item based on the Quarantine order. The three step procedure is as follows: 1. An item is received through registration or packing slip updated into standard inventory. 2. A Quarantine order is created, either manually or automatically, moving the item to the quarantine warehouse and making the item unavailable from the standard inventory. 3. The Quarantine order is processed in the Quarantine orders form, and then reported as finished and ended. This transfers the item back to the standard inventory.
Manual Quarantine Orders

Most companies differentiate purchased items into high value and low value items. High value items are usually set for automatic quarantine and low value for manual quarantine. When you create a manual quarantine order it corresponds, in principle, to a transfer journal, although there must be at least one quarantine warehouse created for quarantining to be performed. Notice that for manual quarantine management, the item does not have to be set up for quarantine management in the Inventory model group.
Procedure - Create and Process a Manual Quarantine Order

To create and process a manual quarantine order, follow these steps: 1. Open Inventory management > Periodic > Quality management > Quarantine orders. 2. Create a new quarantine order. 3. Specify the item number, the warehouse and site where the item is stored, the quarantine warehouse and the number of items to be quarantined. 4. Save the order by pressing CTRL+S. 5. When the order is created, it must be processed by clicking the relevant buttons on the Quarantine orders form. This moves the order through the following four statuses. o Created o Started
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o o Reported as finished Ended
6. The item now has four transactions posted. To see these transactions open the Transactions form by clicking Inventory > Transactions from the Quarantine order form.
Manual Quarantine Orders - Status Overview

The following table contains descriptions of the statuses that a quarantine order is processed through after it is created. Status Created Description This is the status of the order when it is created manually and the item is not yet put in the quarantine warehouse. When an order has the status of Created, you can register the quarantine items with, for example, serial or batch numbers to be able to trace the items when they leave the quarantine warehouse. The items can also be picked and/or reserved from the standard warehouses, if you must control which exact items go into quarantine. On this status a transfer transaction is created and the item is now moved from the default warehouse to the quarantine warehouse. This is created for the manually created order when you click Start. For the automatically created Quarantine orders, this is the status that is given when you create it. If you report a Quarantine order as finished, the item is released from quarantine; however, it is located in the quarantine warehouse. If you use Warehouse management, you can specify an item arrival journal that is initialized at the time that the order's items are quarantined. Click the Report as finished button to report the quarantine order as finished. The item is now transferred from the Quarantine warehouse and back to the standard (or default) warehouse. At this point, the item is available in standard inventory and the quarantine management process is completed. This occurs when you click the Ended button.
Started
Reported as finished
Ended
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Manual Quarantine Orders - Release
If you do not use the Warehouse management module, you do not have to change the status to Report as finished (just Ended) for Microsoft Dynamics AX 2009 to handle quarantine management. However, notice that the item must also be physically transferred whenever a Quarantine order is Ended, as ending the Quarantine order releases the item.
NOTE: Only Quarantine orders with a status of Created or Ended can be deleted manually.
Scenario - Automatic Quarantine Management

An item can be set up so that all receipts are automatically quarantined. At Contoso Entertainment Systems, all items received from the five vendors who have had the greatest number of product recalls, are automatically quarantined. During this quarantine, the items are randomly tested for defects or other problems. Depending on the number of passed or failed tests, Contoso Entertainment Systems will accept the shipment into inventory or return it to the vendor for replacement.
Set Up Automatic Quarantine Management

When you set up automatic quarantine, the following conditions are prerequisites: The item's inventory model group and dimension group must be set up with the correct parameters previously discussed. The warehouse where the item is being purchased must have a quarantine warehouse attached to it.
If these settings are enabled, all receipts of the item automatically create a Quarantine order that is located in Inventory management > Periodic > Quality management > Quarantine orders. The automatically generated Quarantine order puts the item in the quarantine inventory and is processed through the order statuses in the same manner as a manual quarantine order. Therefore, the order must have the status Reported as finished or Ended before the item is physically available in the standard inventory. Notice that, unlike the manual quarantine order, the automatic quarantine order has the status of Started when it is created.
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Automatic Quarantine Orders
If an item is set up for automatic quarantine the quarantine order can be created at the following points in time. Creation On packing slip update Description The item is put in a quarantine warehouse when the purchase packing slip is updated. For this option, there is no registration requirement. The item is put in a quarantine warehouse when registered in purchasing. For this option, the Registration requirement check box must be selected in the Inventory model group. The item is registered at a standard (or default) warehouse with the help of a Location journal. When the journal is posted, a pallet transport is generated to move the item from the regular warehouse to the quarantine warehouse. When the pallet transport is Complete, a Quarantine order is generated. The pallet is moved to a quarantine warehouse.
On registration
Location journal
Quarantine Order Processing Options

During the quarantine order, the processing of quarantine items can be split, returned, or scrapped depending on the result of the quality control. These options are available when a quarantine order, or part of an order, is not ready to be put into the standard warehouse or is up to the required standard.
Scenario: Split Quarantined Items

Contoso Entertainment Systems receives 30 projector lamps and because there have been several defects on these items earlier, the order processor decides that the lamps must be quarantine managed. In the quarantine warehouse, it is determined that 20 items are satisfactory and ten of the items have minor defects and cannot enter the standard warehouse. To end only the part of the order that has passed the quarantine and possibly scrap or perform additional tests on the ten items, the order processor can split the order.
Procedure: Split a Quarantine Order

To split a Quarantine order, follow these steps: 1. Open Inventory management > Periodic > Quarantine management > Quarantine orders. 2. Select a quarantine order. 3. Click Functions > Split.
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4. Specify the quantity to split. 5. Click OK. When you click OK, a new quarantine order is created in the Quarantine orders form that has the split quantity and the quantity on the original quarantine order is updated. It is now possible to end the part of the order that passed the quarantine by selecting that quarantine order and clicking Report as Finished and End.
NOTE: Quarantine orders must be in a Created or Started status to split quantities on the order.
Scenario: Split and Return Part of a Quarantine Order

Contoso Entertainment Systems receives ten subwoofers from Litware Electronics. The items must be quarantine managed and a quarantine order is created and started. The goods are checked at the quarantine warehouse and it turns out that four of the ten items are defective and Contoso Entertainment Systems wants to return the defective items to the vendor at the vendor's expense.
Procedure: Return the Defective Items

To return the four items in Scenario: Split and Return Part of a Quarantine Order, follow these steps: 1. Click Accounts payable > Purchase Order Details. 2. Create a new purchase order and select Returned order in the Purchase type field in the Create purchase order form. 3. Specify the RMA number, and click OK to create the purchase order header. 4. Create a purchase line for four items. 5. On the purchase order line, specify the warehouse, to which the returned items were sent from the quarantine warehouse, and type 4 in the Quantity field. The quantity must be negative. 6. Specify a return action on the Setup tab in the Returned item field group. 7. Invoice the purchase order for the returned items.
NOTE: The return actions are set up for purchase orders in Accounts payable > Setup > Purchase order >Return action.
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Scenario: Scrap Quarantined Items
Contoso Entertainment Systems receives 20 items that must be quality checked before they go into the main warehouse. Five of the items prove to be defective, and instead of returning them to the vendor, Contoso Entertainment Systems decides to scrap them because the value is not significant enough to create a vendor return order.
Procedure: Scrap a Quarantine Order

To scrap a quarantine order, or part of it, follow these steps: 1. Open Inventory management > Periodic > Quality management > Quarantine orders. 2. Select a quarantine order with the status of Started. 3. Click Functions > Scrap. 4. Specify the quantity of items that must be scrapped and the date when to scrap them. 5. Click OK.
NOTE: Quarantine orders must be in a Started status to scrap quantities on the order.
When an item is scrapped, it does not affect the quantity on the Quarantine order line. When you click the Report as finished and/or End button, notice that the scrapped quantity has been deducted from the quantity. Therefore, only the part of the order that passed quarantine is reported as finished and ended. To see the transactions generated when scrapping an item, click Inventory > Transactions.
View Ended Quarantine Orders

In the Quarantine orders form, you can select the View ended field. This helps if you only want to see finished orders, that is, those with a status of Ended.
Items in Quarantine Report

You can view items that are in quarantine by using a standard report in Microsoft Dynamics AX 2009. If the quality controller creates the Items in Quarantine report every morning, he or she can assess the volume of the work for the department.
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The Items in Quarantine report is located in Inventory management > Reports > Status > Items in quarantine. The standard defaults are to show items with a Status of Started and Reported as finished. You can modify these choices by clicking the Select button.
NOTE: To modify the statuses click the Select button and type or select the statuses in the Criteria field. Ensure that you separate the statuses with a comma before clicking OK.
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Lab 6.2 - Purchase to Quarantine Inventory

Contoso Entertainment Systems - Company CEU Scenario As the quality controller at Contoso Entertainment Systems, you have a purchase order for ten items of Q.AG.test, item number 800120, that has been received automatically into quarantine. When the quality assurance tests are completed, you verify that eight of the ten items can be accepted into inventory, and the remaining two items must be scrapped.
Challenge Yourself!
Your task is to register these inventory movements, for the quarantine order that you created in Lab - Create Quarantine Inventory.
Need a Little Help?

1. Locate the quarantine order through Inventory management > Periodic > Quality management > Quarantine orders. 2. First split the order into two orders; one order with eight as the quantity and one order with the quantity of two. 3. Scrap the order with the quantity of two and end the order with the quantity of eight.
Step by Step
1. Open Inventory management > Periodic > Quality management > Quarantine orders. 2. Highlight the order for ten items of Q.AG.test, item number 800120 . 3. Click Functions > Split. 4. Type 8 in the Split quantity field. 5. Click OK. 6. Select the order with the quantity of two. 7. Click Functions > Scrap. 8. Type 2 in the Quantity field. 9. Click OK. 10. Highlight the order with eight items of Q.AG.test, item number 800120 11. Click Report as finished. 12. Click OK.
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13. Click End. 14. Click OK.
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Inventory Transactions on Quarantined Items

Inventory transactions are created in Microsoft Dynamics AX 2009 for all statuses of quarantined items except Reported as finished. To view the inventory transactions, open the Items form, select the item and then click the Transactions button. These transactions are for the item number and not a specific sales or purchase order. To view quarantine transactions on a sales or purchase order, open either of these forms and select the order for which you want to see the transactions. Click the Inventory button and select Transactions.
Scenario - Demonstration of Transactions

The new auditor at the Contoso Entertainment Systems has expressed concern about inventory control in the warehouse and quarantine warehouse. Therefore, the auditor has asked the Inventory manager to show him or her how to always identify, where all items are within the warehouses. The Inventory manager explains that because Contoso Entertainment Systems uses an Enterprise Resource Planning (ERP) system, all data is linked, and within that ERP system, all inventory transactions can always be viewed. The inventory manager shows the use of the transactions in Microsoft Dynamics AX 2009, and can reassure the auditors that it is always clear where all inventory is when it is in the warehouses.
Created Transactions
When a quarantine transaction has the status Created, two inventory transactions are created: On order and Ordered. Transaction Type On order Ordered Description An issue transaction is created in the regular (default) warehouse with a status of On Order. A receipt transaction is created in the quarantine warehouse with a status of Ordered.
Started Transactions
When the order status on quarantine transaction is changed to Started, two of the existing inventory transactions statuses are changed and two undated inventory transactions are created, for a total of four inventory transactions. The transactions, Ordered and Reserved physical, are created to handle the return transfer of the items as soon as the quarantine order status is Ended.
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These transactions are described in the following table: Transaction Type Deducted Description The On order status, in the regular warehouse, is changed to Deducted (Issue transaction) and you also receive a financial date for this transaction. A receipt transaction is created in the regular (default) warehouse with a status of Ordered. The receipt transaction with the status Ordered is changed to status Received and you also receive a financial date for this transaction. An issue transaction is created in the quarantine warehouse with a status of reserved physical.
Ordered Received
Reserved physical
Reported as Finished Transactions

When the order status is changed to Reported as finished, no transactions are created. The item is now released from quarantine but has not yet been transferred back to the regular (default) warehouse.
Ended Transactions
When an item reaches the final status, Ended, the two undated transactions that were created when the order status was changed to Started, are changed as described in the following table. Transaction Type Purchased Description The receipt transaction of the status Ordered, created in the standard warehouse, is changed to status Purchased and you receive a financial date for this transaction. The issue transaction of the status Reserved physical, created in the quarantine warehouse, is changed to status Sold and you receive a financial date for this transaction.
Sold
Summary
Quarantine Management discussed the setup of Microsoft Dynamics AX 2009 for both automatic and manual quality control. It also explained the various statuses that a quality order is taken through and how the transactions are related to each status. Quarantine management helps a company control the item location of incoming items and prevents items from entering a production environment or being sold when they are waiting for quality control or are being controlled.
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Test Your Knowledge

Test your knowledge with the following questions. 1. Task: Outline the basic steps that you would take to accept 80 percent of a quarantined purchase order for receipt, and scrap the remaining 20 percent. 2. Number the steps to form the correct flow of tasks. Step _____ : Click Functions > Split Step _____ : Select the line to scrap Step _____ : Type the quantity to be scrapped Step _____ : Type the Split quantity Step _____ : Click Functions > Scrap Step _____ : Open the Quarantine orders form Step _____ : End the line for items to be posted into inventory 3. Task: Outline the basic steps in setting up a quarantine warehouse. 4. Number the steps to form the correct flow of tasks. Step _____ : Select the main warehouse and attach the new quarantine warehouse to it Step _____ : Select Quarantine as the type Step _____ : Create a new warehouse Step _____ : Click Inventory Management > Setup > Inventory Breakdown > Warehouses 5. Describe how an item is automatically moved into a quarantine warehouse.
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Solutions
Test Your Knowledge
1. Task: Outline the basic steps that you would take to accept 80 percent of a quarantined purchase order for receipt, and scrap the remaining 20 percent. 2. Number the steps to form the correct flow of tasks. Step 2 : Click Functions > Split Step 5 : Select the line to scrap Step 7 : Type the quantity to be scrapped Step 3 : Type the Split quantity Step 6 : Click Functions > Scrap Step 1 : Open the Quarantine orders form Step 4 : End the line for items to be posted into inventory 3. Task: Outline the basic steps in setting up a quarantine warehouse. 4. Number the steps to form the correct flow of tasks. Step 4 : Select the main warehouse and attach the new quarantine warehouse to it Step 3 : Select Quarantine as the type Step 2 : Create a new warehouse Step 1 : Click Inventory Management > Setup > Inventory Breakdown > Warehouses 5. Describe how an item is automatically moved into a quarantine warehouse. MODEL ANSWER - Items are automatically moved into quarantine based on their Inventory model group, assuming the warehouse and site that the items are being purchased into has a quarantine warehouse attached to it.
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Chapter 7: Vendor Returns
CHAPTER 7: VENDOR RETURNS

Objectives
The objectives are: Create a vendor return by using a Negative quantity, the Create credit note feature, and the purchase order type Returned order. Return an item with multiple serial and batch numbers to a vendor.
Introduction
Companies frequently return items to their suppliers when, for example, the goods are the wrong size/color, the expiration date has passed or the goods are damaged during transportation or because of a wrong handling. In Microsoft Dynamics AX 2009, vendor item returns are handled like purchase orders, as they involve transactions in the Inventory management, General ledger, and the Accounts payable modules. Vendor Returns discusses how to return a product to a vendor. You will be shown how to handle the returns with and without serial and batch numbers attached.
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Create Vendor Returns

Certain modules are affected for purchase orders and returns when you use the Vendor Returns feature.
FIGURE 7.1 MODULES AFFECTED IN PURCHASE ORDERS AND PURCHASE RETURNS
Companies can issue vendor returns for various reasons, such as for damaged products or perhaps the vendor shipped the incorrect product. You must issue a vendor credit note when items are returned to the vendor. There are three methods to create vendor credit notes, as shown in the following table. Method Use a negative quantity Copy the original purchase invoice. Returned order purchase type Description A purchase order for an item with a negative quantity. The credit note is created from the original purchase invoice. The purchase order type is selected as Returned order and not as a purchase order.
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Negative Quantity
The first method to create a vendor return is to specify a negative quantity on the purchase order line in a new or existing purchase order. Typing a negative quantity in the purchase order line has the same effect as if you are actually selling from your inventory to the vendor that you want to return the items to. Companies can use the Negative Quantity method, for example, when a return is made to a vendor and no reference to a specific purchase order or Return Merchandise Authorization (RMA) number is required.
Procedure: Negative Quantity

To create a vendor return by using negative quantity, follow these steps. 1. Click Accounts payable > Purchase Order Details and create a new purchase order. 2. Select an item number and, for example,-5 in the Quantity field to indicate that this is an item return. Notice that the amount in the Net amount field is automatically given a minus sign.
HINT: You can indicate a specific return action by going to the Setup tab on the purchase order line and selecting a Return action in the Returned order field group. The return action is for information only and has no functionality on the vendor return.
3. When negative quantity has been entered, post the return. 4. On the Purchase order header, click Posting > Invoice. 5. In the Posting invoice form, ensure that All is selected in the Quantity field, specify the invoice number in the Invoice field, and then click OK. 6. The invoice has now been posted and Microsoft Dynamics AX 2009 records the items as being removed from the system. To verify this, click Inventory > Transactions from the purchase order line. Notice the negative quantity, and that the Issue column is set to Sold to indicate the items leaving the inventory.
Copy Original Purchase Invoice

Another method to issue a vendor credit note is to copy a previously posted purchase invoice. The copy feature is time saving as it prevents you from having to key in the original purchase information again. This method is primarily used when you must match a credit note to an original purchase order. The original pricing is used when you copy the original purchase order. This eliminates any variance that may occur if the purchase price has changed after the original order was invoiced.
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In addition, when you copy the purchase order, Microsoft Dynamics AX 2008 ensures that the return quantity does not exceed the original quantity received from this purchase order.
Procedure: Copy the Original Purchase Invoice

To create a vendor return by copying the original purchase order, follow these steps. 1. Click Accounts payable > Purchase Order Details and select a Purchase order that you want to create a credit note for. 2. On the Purchase order header, click Functions > Create credit note. 3. The Create credit note form contains a list of posted invoices from the specific vendor on the Invoice tab; and for every header, the lines are shown in the lower pane. 4. Highlight the invoice number from which you want to create a credit note. 5. Select the Mark check box for the item that you want to return, and then update the Quantity field. 6. Click OK and your credit note is created in the Purchase order form with the line that you selected. Notice that the quantity is a negative number which indicates a credit note.
NOTE: You can only copy one invoice for each credit note by using this feature on the header. If you create a credit note by using the feature on the purchase line level, you can select multiple invoices.
HINT: Select the Select All check box on the invoice header and all the purchase order lines will be copied to the credit note. If you do not want to select all the purchase lines, select the Mark check box on the appropriate purchase lines. Ensure that you have the correct header selected before you select the individual lines.
Procedure: Post the Copy of the Original Purchase Order

To post a copy of the original purchase order, follow these steps. 1. When the credit note has been created, you can indicate a return action on the Setup tab for each purchase order line. This is optional. 2. To post the return, click Posting > Invoice. 3. Specify the invoice number on the Posting invoice form and then click OK. The credit note is now invoiced. 4. To verify the transactions, select the line for which you want to see the transactions, and then click Inventory > Transactions. Notice that Sold is specified in the Issue field and that the quantity is negative. This means that the item is removed from inventory.
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Returned Order Purchase Type
The third and final way to issue a vendor credit note is to create a purchase order by using the order type Returned order.
NOTE: This is the only method in the Accounts payable module where you must enter an RMA number and a Return action.
The RMA number is a reference used for tracking purposes and is typically issued by the vendor when you return goods to them. This number acts as a preapproval number with which to return goods. Scenario At Contoso Entertainment Systems, the Purchasing manager wants all Purchasing agents to have an RMA number associated with a return before any physical stock is moved. To support this requirement, all Purchasing agents must use the purchase order type Returned order when they create a return. As an added benefit, the Returned order type checks that the quantity is negative, which minimizes data entry errors.
Procedure: Create a Returned Order Purchase Type

The following procedure shows how to create a vendor credit note by using the order type Returned order. 1. Open Accounts payable > Purchase Order Details and create a new purchase order. 2. In the Create purchase order form, select the vendor for which you want to return items. 3. In the same form, select Returned item in the Purchase order dropdown menu under the General field group. Notice that the RMA number field appears under the Purchase order field. You must fill in the RMA number at this point. Typically you have already been in contact with the vendor and have received this number. 4. Click OK to create the Purchase order header. 5. Create a new purchase line and select the items to return and enter the quantity with a negative sign. 6. On the Setup tab on the purchase order line, select a Return action. If a return action is not selected, an error appears when you try to post the invoice.
HINT: To create a new return action, right-click in the Return action field and select Go to the Main Table Form. In the Return action form, press CRTL+N to create a new return action and specify the name and description.
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7. Now the order is ready to be invoice updated by clicking Posting > Invoice, and specifying the invoice number, and then clicking OK. 8. The credit note has been fully invoiced. To view the posted transactions, click Inventory > Transactions. Notice that the quantity is negative, indicating that the items are removed from inventory because of the posted return
Create Vendor Returns for Serialized Items

When returning a serialized item to the vendor, you must specify the item's serial and batch number on the credit note line. This ensures that the correct serial/batch number will be removed from inventory and also indicates to the vendor which serial/batch numbers are returned. When you create vendor returns for serialized items, there are the same three options as for non-serialized items: Negative quantity Copy the original purchase invoice Returned order purchase type
Scenario - Vendor Return for a Serialized Item

Contoso Entertainment Systems ordered and received five lamp transformers from vendor 1103 - Fog Projectors. After inspection, four of the lamp transformers were found to be defective and must therefore be returned to the vendor. These transformers are serialized so identification of which one is returned is important. By using the order type Returned order, the Purchasing agent can generate the negative purchase order appropriately.
Procedure: Create a Returned Order Heading

To create a Returned item order heading, follow these steps. 1. Click Accounts payable > Purchase Order Details and create a new purchase order. 2. In the Create purchase order form, select the type Returned order in the Purchase order field. 3. Enter an RMA number and then click OK.
Procedure: Create a Returned Order Line for a Serialized Item

To create a Returned item order line for a serialized item, follow these steps. 1. Create a new purchase order and purchase order line for an item that is serialized. Ensure that you type a negative quantity.
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NOTE: If you only return one item or one batch where only one serial or batch number is required for the purchase order line, you can select these numbers directly from the line, from either the Serial number field or the Batch number field.
2. Click Inventory > Reservation to specify the serial numbers. 3. The Reservation form shows the serial numbers available in the warehouse of the purchase line.
NOTE: If the field Serial number is not available in the Reservation form, click Inventory dimensions display and select the Serial number check box, and then click OK.
4. Select the serial numbers that you want to return to the vendor by entering the quantity requested in the Reservation column for the appropriate serial numbers. Notice that you can only select as many serial numbers as specified in the Quantity field of the purchase order line. 5. Close the Reservation form. 6. Select a Return action on the Setup tab under the Returned order field group and invoice update the credit note. 7. When the purchase return has been posted, verify that it removed the correct serial/batch numbers from inventory. To do this, click Inventory > Transactions on the Purchase order line. The Serial number field displays which serial numbers were selected and the Issue field displays the status as Sold.
Scenario: Vendor Return with Items from Two Batches

Contoso Entertainment Systems has made an agreement with vendor 1103 - Fog Projectors, to return ten Lamp transformers because the items are defective. The defective transformers were received on two purchase orders, and from two batches. For tracking and statistical accuracy, the Purchasing agent will use the create credit note method for this return.
Procedure: Create a Vendor Return from Two Batches

To return items to a vendor from two purchase orders and two batches, by using the create credit note functionality, follow these steps. 1. Create a new purchase order for the vendor that you will return the items to. 2. To copy an original purchase order, click Functions > Create credit note on the Purchase order header.
NOTE: You can also access the Create credit note functionality from the purchase order lines.
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3. In the Create credit note form, highlight the purchase order that you want to return from. 4. In the line for this purchase order select the Mark check box and update the quantity. 5. Highlight the second purchase order that you want to return items from. 6. On the line for the second purchase order, select the Mark check box and update the quantity in the Quantity field. 7. Click OK and the information from the original purchase order is copied into the new purchase order.
NOTE: When the information from the original purchase order has been copied to the new order, you can still edit the quantity of the purchase order in case you want to return a different quantity.
Procedure: Reserve Batch Numbers to be Returned

The batch numbers can be selected on each purchase order line in the Batch number field, but the recommendation is that you reserve the batch numbers for the item return instead. To do this, follow these steps. 1. Highlight the first purchase order line and then click Inventory > Reservation. The Reservation form shows the batch numbers available for the warehouse of the purchase line. 2. Items have already been deducted from a batch and from the available inventory. However, changes can be made to this, if for example the items must come from another batch or from two batches. 3. Specify changes to the batch numbers. 4. Delete the quantity specified in the Reservation column by highlighting the number and clicking Delete. 5. Select the batch numbers to return to the vendor by entering the quantity requested in the Reservation column for the appropriate batch numbers. 6. The purchase order number associated to each batch is shown at the bottom of the screen when a line it is highlighted on the Overview tab. 7. Close the Reservation form. 8. From the Purchase order form repeat steps 1 through 7 for other purchase order lines. 9. Now the purchase order is ready to invoice update and as soon as the posting is complete. Verify that the system removed the correct batch numbers from the inventory. To do this click Inventory > Transactions.
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Inventory Pick
Instead of reserving the serial and batch numbers, you can also do a pick by going to Inventory > Pick from the purchase order line. The benefit of making a reservation is that the items that you want to return are reserved at the warehouse and the same items are not available for other people to reserve or pick. Notice that if the item has Picking requirements selected in the inventory model group, picking must also be performed in a credit note.
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Lab 7.1 - Working with Vendor Returns

Contoso Entertainment Systems - Company CEU Scenario Contoso Entertainment Systems regularly orders lamps for LCD Video Projector Model 02, item number 1508, from vendor 1103 Fog Projectors. Fog Projectors has promised a credit note for any lamp scrapped at receipt. Contoso Entertainment Systems has received a box at their general warehouse that has 10 broken lamps (item 1508) from purchase order number 000004.
Challenge Yourself!
Your task is to return these lamps to the vendor by using the same information found on purchase order number 000004.
Need a Little Help?

1. Create a purchase order header for vendor 1103, Fog Projectors. 2. Create the credit note by copying the original purchase order. On the purchase order header click Functions > Create credit note. 3. In the Create credit note form find purchase order 000004 and change the quantity on the line for item 1508. 4. Remember to select the Mark check box.
Step by Step
Open Accounts payable > Purchase Order Details. Press CTRL+N to create a new purchase order. Select Vendor account 1103. Click Yes to transfer information from vendor. Click OK. Click Functions > Create credit note. Click Purchase order 000004, and select the Select all check box. In the lines section clear the Mark check box for the lines where the item number is not 1508. 9. In the Quantity field type10. 10. Click OK. 11. Close all the forms. 1. 2. 3. 4. 5. 6. 7. 8.
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Lab 7.2 - Complete a Vendor Return Using Returned Order Type

Contoso Entertainment Systems - Company CEU Scenario The purchasing agent at Contoso Entertainment Systems has contacted vendor 1103, Fog Projectors for a Returned Merchandize Authorization (RMA) number for batch 000003 of item number 1706, to approve the return. This item did not pass the quality control. The return must have batch number identification to be accepted by the vendor. Fog Projectors provides the purchasing agent with the RMA number AS2512 and you will use your generic invoice number of INV123. The purchasing agent views the transactions to ensure that they were completed correctly.
Challenge Yourself!
1. Create a Purchase order with the order type Returned order with the specifications written in the scenario. 2. Make a reservation of batch number 00003. 3. Post the invoice and verify the transactions.
Need a Little Help?

1. Create a new purchase order and change the order type to Returned order after you select the vendor. 2. Remember to specify the RMA number, AS2512. 3. Use Inventory > Reservation to view and select batch numbers. 4. If the Batch number field is not displayed in the Reservations form, click Inventory > Dimensions display and select the Batch number check box. 5. Click Inventory > Transactions to view the transactions.
Step by Step
1. 2. 3. 4. 5. Open Accounts payable > Purchase Order Details. Press CTRL+N to create a new purchase order. Select Vendor account 1103. Click Yes to transfer vendor information. In the General field group, click the Order type arrow, and then select Returned order.
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6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. In the RMA number field, type AS2512. Click OK. Click the Item number arrow, and then select 1706. TAB to the Quantity field, and type -1. Click Inventory > Reservation. Click Inventory > Dimensions display. Select the Batch number check box. Click OK. Select batch number No 000003. TAB to the Reservation field, and type 1. Close the Reservation form. Click Posting > Invoice. In the Quantity field, confirm that All is selected. In the Invoice number field, type INV123. Click OK. Select the purchase order in the Purchase order form. Click Inventory > Transactions. Close all the forms.
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Summary
Returning an item to a vendor is handled like selling from inventory to the vendor to whom the items must be returned. The three ways to create a vendor return are: Negative Quantity: a return action that is made when no specific reference to the original purchase order of RMA number is required. Create credit note: a copy of the original purchase order information. Returned order purchase order type: the only vendor return that requires an RMA number and a Return action.
When you return serialized items to a vendor the same three credit note options are available as for non-serialized options. The Create Vendor Returns for Serialized Items lesson demonstrated how to create a vendor return with both one and multiple serialized items by using the purchase order type Returned order.
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Chapter 8: Sales Orders and Sales Order Posting
CHAPTER 8: SALES ORDERS AND SALES ORDER POSTING

Objectives
The objectives are: Use the Simple and Advanced views to create a sales order Determine and apply different sales order types Set up Accounts receivable sales order parameters Specify multiple delivery addresses for sales order lines Copy an address into the address book Set up the Delivery date control system Use the Available dates feature to specify and update request dates Create order entry deadline and order entry deadline groups for sites Review how to create a sales order in a multi site environment Create an order of the type Direct delivery and update the order Review the sales order posting statuses and profiles Post a sales order confirmation Post a sales order picking list Post a Sales order Picking list registration Post a sales order packing slip Post a sales order invoice Post a sales order invoice based on a packing slip Set up sales order posting profiles Review how the multisite feature has affected the create purchase order and direct delivery functionalities Review the Supply overview form Explore the shipment carrier interface feature
Introduction
Sales Orders and Sales Order Posting shows how to: Create a sales order by using the Simple and Advanced views in the Sales order form. Work with sales orders. Identify the effect that sales order parameters in Accounts receivable have on the creation of sales orders.
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Use various sales order posting techniques. Set up inventory posting profiles that you use when you sell from inventory.
The course also discusses the more advanced sales order functionality in Microsoft Dynamics AX 2009, including the following topics: Multiple ship to functionality, which lets you specify multiple delivery addresses for sales orders. Advanced delivery date control, which helps order takers accurately calculate the expected delivery date of goods to the customer. Direct deliveries, where you can create a purchase order that is shipped directly from the vendor to the customer and control posting updates between the linked purchase and sales orders from the purchase order. Order entry deadlines, where you can accommodate the ability for other sellers to work with sales orders across sites in multiple time zones. Features that support the multisite functionality.
Working with Sales Orders

When working with sales orders, you will need to create a new sales order and add items to it. In addition, depending on the business need, various types of sales orders are offered in Microsoft Dynamics AX 2009, such as: Subscriptions Blanket orders
Sales Order - Simple and Advanced Views

The reasons for using the Simple and Advanced views in the Sales order form are the same as for the Purchase order form. Users of the Simple view generally do not have to view the information that is available from the Advanced view or do not have to access to the Advanced view functionality.
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When using the Advanced view, you can obtain a broad view of all sales orders, perform multiple updates, and access advanced features such as trade agreement and miscellaneous charges functionality.
FIGURE 8.1 SALES ORDER FORM - ADVANCED VIEW
Creating a Sales Order The process of creating basic sales orders resembles that of creating basic purchases orders, except that purchase orders are used to generate receipts of items and sales orders are used for making item issues.
Procedure: Create a Sales Order

This procedure shows how to create a sales order. 1. 2. 3. 4. Click Accounts receivable > Sales Order Details > Advanced. Press CTRL+N to create a new Sales order. In the Create sales order form, select a Customer account. Enter or modify the remaining information in the Create sales order form, if required, and then click OK.
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5. Select or type Item number, Quantity, and Unit price. Microsoft Dynamics AX 2009 defaults information into the sales order line based on how the item has been set up for quantity, price, discounts, site and warehouse, and how trade agreements have been set up for the customer. If you create the lines by using the Advanced view, check the on hand inventory by clicking Inventory > On-hand. 6. Repeat step 5 and 6 for all the remaining sales order lines.
HINT: Use the CTRL+PGDN keys to move the pointer from the header to the lines. If you use this option and there are no sales order lines in the lower pane, Microsoft Dynamics AX 2009 automatically creates a new line in the lower pane.
Sales Order Types

When you create a sales order in Microsoft Dynamics AX 2009, select from one of several sales order types: Journal Subscription Sales Order Blanket Order
You cannot select the following sales order types manually, as they are created through the Return management feature or the Project module. Returned Order Item Requirements
Journal
Sales orders of the type Journal resemble purchase orders of type Journal because they are also used as draft sales orders. Journals help when you bring data into the system that may not meet quality or other standards. This can occur with data loads or data that is entered by a new or temporary worker. A sales order of the type Journal neither affects stock quantities nor generates item transactions, and the quantity on the order line will not be considered in Master planning.
Subscription
The sales order type Subscription is used for repeated sales of the same goods or services to the same customer. When a packing slip is updated, Microsoft Dynamics AX 2009 generates a packing slip. When the invoice is updated, a new packing slip or invoice entry can be updated for the same sales line. The order never has an Invoiced status, only Open or Delivered.
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EXAMPLE: Light and Design have a standing order to buy 100 CL-100-B-M lamps from Contoso Entertainment Systems. The order taker creates a sales order of type Subscription for Light and Design and creates a line for 100 pieces of CL-100-B-M. Each month, the subscription is invoice-updated, and the goods are delivered to the customer and the customer is billed for the standard quantity of 100 pieces. The sales order remains at the status Open order but transactions are created for the sales order line.
Sales Order
The sales order type Sales order is used when the customer confirms that he or she wants the order. When you create a new order, set the type to use the Sales order type inside the Parameters form, depending on the client's business process.
Blanket Order
The sales order type Blanket order works the same as for a purchase order except the order is made with a customer for whom you periodically generate release sales orders.
Returned Order
The sales order type Returned order is used when you receive goods back from a customer. The Returned order type inside Microsoft Dynamics AX 2009 cannot be selected manually; it is created through the Return orders form in Accounts receivable > Return Order Details.
Item Requirements
The sales order type Item requirements is connected to the Microsoft Dynamics AX 2009 Project module. When you create the item requirements in the Project module, the system automatically creates a sales order of the type Item requirements.
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Lab 8.1 - Create a Sales Order

Contoso Entertainment Systems - Company CEU Scenario The customer, Sparrow Wholesales, calls and orders ten pieces of item number 1701, Standard DVD player - black. As a sales clerk with Contoso Entertainment Systems, you will create the sales order and print the Sales order confirmation for the customer.
Challenge Yourself!
Create the Sales order, and post the Sales order confirmation to the screen.
Need a Little Help?

The Sales order form is opened through Accounts receivable > Sales Order Details. Post the Sales order confirmation by using the Posting button in the Sales order form.
Step by Step
1. Click Accounts receivable > Sales Order Details > Advanced. 2. Press CTRL+N to create a new Sales order. 3. In the Create sales order form, select Customer account 1201, and then click OK. 4. Select Item number 1701 5. Type 10 in the Quantity field 6. Click Posting > Confirmation 7. Select the Print confirmation check box 8. Click OK
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Sales Parameters
In the Accounts receivable parameters, you can create default settings that are used when you create sales orders.
Accounts Receivable Sales Parameters

Sales parameters in Accounts receivable resemble the parameters for purchase orders. With sales parameters, you can perform the following tasks. Select the default sales order type to use when you create a new sales order. Specify any of the sales order types described in the topic about sales order types, except Returned order and Item Requirement. Select the Prompt for customer information parameter if the user must be prompted for transfer of customer master data to the sales order on sales order creation or modification. Select the template customer who must be used for any one-time customer that you create.
Accounts receivable > Setup > Parameters
FIGURE 8.2 ACCOUNTS RECEIVABLE - SALES ORDER PARAMETERS
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Lab 8.2 - Apply Sales Parameters

Contoso Entertainment Systems - Company CEU Scenario You are a Microsoft Dynamics AX 2009 implementer and have been asked to visit the sales team at Contoso Entertainment Systems to provide additional training so the team can take better advantage of their system. When arriving on site, you ask the team what they find time-consuming or cumbersome in their daily procedures. You learn that most of the new orders are for the Sales order sales type and the orders arrive as faxes. Therefore, it will increase data entry efficiency if the system defaulted to creating the Sales order Sales order type. Additionally, because the customer information is frequently included on the faxes, the Accounts receivable coordinator must check the customer information before accepting it in the Create sales order form.
Challenge Yourself!
Set up the parameters to meet the requirements outlined in the scenario.
Need a Little Help?

1. Find the parameters in Accounts receivable > Setup > Parameters. 2. Select the General tab and change the appropriate fields.
Step by Step
1. Click Accounts receivable > Setup > Parameters. 2. On the General tab, select Sales order as the Sales order type. 3. On the General tab, select the Prompt for customer information check box. 4. Close the Parameters form.
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Ship to Multiple Addresses

The Multiple ship to functionality enables users to specify delivery addresses for each order line instead of only according to the order header. This is useful if, for example, to collect sales order lines to different delivery locations in one sales order. Use the Multiple ship to functionality to: Specify multiple customer delivery addresses on sales order lines. Copy addresses that are manually entered on the sales order into the Alternative addresses table for reuse later. Select if sales order documents are printed for each delivery address or for each order.
Scenario: Specify and Save an Alternative Delivery Address for a Sales Order Header
The order taker has been informed that because of a temporary relocation of a customer, the sales order must be sent to another delivery address. This address differs from the customer's main address specified in the Customers form. Therefore, the order taker must update the sales order with the new delivery address for the customer. To do this, the order taker updates the delivery address on the Sales order header, and then copies the new address to the Alternative delivery address for the customer for later use.
Procedure: Insert an Alternative Address for a Sales Order Header

To insert an alternative address for a sales order header, follow these steps. 1. Click Accounts receivable > Sales Order Details. 2. Select a sales order. 3. Click Setup > Alt. address. The Address selection form opens and, by default, the Customers tab is active. 4. Click one of the tab pages and select, for example, another sales order or customer, depending on the address that you want to use. 5. Select which address to copy to the sales order. 6. Click Copy addr. to order in the: o Top pane, and the address in the expandable Address field is copied to the sales order. o Lower pane, and the address on which you have the focus in this pane is copied to the sales order.
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The Address selection form closes and the address specified is copied into the sales order. When you save the order header, a dialog box appears that asks if you want to update the sales order lines that had the same address as the header before the update with the new address that was used to update the sales order header.
Scenario: Specify an Alternative Delivery Address for Sales Order Lines

The order taker is informed that a sales order, with three sales order lines for a customer, must be delivered to three delivery addresses for three of their retail outlets. The customer informs the order taker that they need a packing slip for each delivery address. The order taker updates the Delivery address on each sales order line, and when the items are ready for delivery, the order taker packing slip updates the sales order. As the Packing slip parameter is selected in the Split based on delivery information field group, one packing slip is printed for each sales order line for each of the retail outlets.
Procedure: Select an Alternative Address on a Sales Order Line

To select an existing alternative address for a sales order line, follow these steps. 1. Click Accounts receivable > Sales Order Details. 2. Select a Sales order, and then select a Sales order line. 3. Click Setup > Alt. address. By default, the Sales order tab is active with the sales order to which the order line is attached. 4. Select an alternative address and then click Copy addr. to order.
Procedure: Save an Address in the Address Selection Form

To save an address in the Address selection form for later use, follow these steps. Select a Sales order/Sales order line. Update the Delivery address. Click Setup > Alt. address. Click the tab for the category to which you want to save the address, for example Sales order. 5. Click Copy addr. from order and the address is copied into the Address selection form. 1. 2. 3. 4.
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Make a temporary record of the delivery address by copying the address from the sales order or sales lines to the respective tab in the Address selection form. If you later decide to move the address from the sales order or sales line to the customer's address book, click the Address tab on the Address selection form and then click Move and the address becomes one of the customer addresses. When copying a delivery address, you can also specify a customer receipt calendar specifically for this address, because the customer receipt times at this address can be different from opening times at the default customer address.
Enhanced Delivery Date Control

The Enhanced delivery date control function is primarily about giving realistic and complete delivery promises to a customer during sales order entry and shortening the sales order entry time. The Enhanced delivery date control supports the user in his or her daily work and makes it simpler to give realistic delivery dates. The order taker enters sales orders and Microsoft Dynamics AX 2009 checks if the requested delivery date for the customer can be met from a shipping perspective. If a requested delivery date cannot be met, the order taker is provided with user-friendly simulation that lists the options to help find a resolution to the requested delivery date problem. Use the delivery date control function together with transfer orders, where the delivery date control is used to calculate earliest possible ship and receipt dates for the transfer order/transfer order lines. Enhanced Delivery Date Control examines: Various levels at which the delivery date control can be enabled The range of factors to include in the delivery data calculation to give you the most accurate delivery date Using the Available dates functionality to simulate different delivery scenarios and accept or reject calculated delivery dates
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Enable the Delivery Date Control Feature
To enable default delivery date control on the sales order header, you must enable the feature. Do this by selecting Sales lead time in the Delivery date control parameter in Accounts receivable > Parameters > Shipments tab.
FIGURE 8.3 ACCOUNTS RECEIVABLE PARAMETERS SHIPMENTS TAB
Enabling the Delivery Date Control feature ensures that delivery date control is set by default each time you create a sales order header. You can set up delivery date control on each item, in the Default order setting form, and this will default to the sales order lines, even if the Delivery date control parameter setting is set to None. The Delivery date control setting on the item overrides the parameter setting. You can also enable the Delivery date control function at various points in the sales order creation process. Enable the control in the following places: Create sales order Sales order header Sales order lines Create release order
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Enable the delivery date control function for Transfer orders in Accounts receivable > Parameters.
NOTE: If you select ATP in the Delivery date control parameter, it will work with the Available-to-promise (ATP) time fence and ATP incl. planned orders parameters for the ATP feature.
Available-to-Promise
The available-to-promise (ATP) parameter is available in the Delivery date control field in the Accounts receivable parameters and on the Default order settings form on the item setup. ATP is a feature that provides a response to customer order enquiries, based on resource availability. It generates available quantities of the requested product, and delivery due dates. ATP supports order promising and fulfillment, aiming to manage demand and match it to production plans. The system calculates the ATP quantity based on the cumulative ATP with look-ahead method. The main advantage to this method of calculating ATP is that it can handle instances when the sum of issues between receipts is bigger than the latest receipt, that is, when it is necessary to use a quantity from an earlier receipt to meet a requirement. By including all of the issues until the cumulative quantity to receive is bigger than the cumulative quantity to issue, the ATP quantity in an earlier period considers the need to use some of that quantity in a later period. Microsoft Dynamics AX 2009 calculates the ATP using the following formula: ATP = ATP for the previous period + the receipts for the current period - the issues for the current period - the net issue quantity for each future period until the period when the sum of receipts for all future periods, up to and including the future period, is greater than the sum of issues, up to and including the future period. You can learn more about available-to-promise (ATP) in the Microsoft Dynamics AX 2009 Production series.
Earliest Possible Delivery Date Factors

There are several factors that determine the earliest possible delivery date to the customer when you use the delivery date control functionality. Microsoft Dynamics AX 2009 uses certain factors to base its calculation of the earliest possible delivery date for a sales order. The factors that are considered when calculating the earliest possible delivery date are: Sales lead time Coverage calendar
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Order deadlines Transport time Transport calendars Customer receipt calendars
Sales Lead Time

Sales lead time is the number of days you can use on all the activities from receiving the sales order to shipping it. These activities can include the following: Sales administration tasks Conducting checks on items before shipping them Warehouse administration
The Sales lead time is a default value for all items that you sell from your company. However, notice that the sales lead time on individual items overrides the Sales lead time in the Accounts receivable parameters. Define sales order lead time in Accounts receivable > Setup > Parameters > Shipments tab. Considering the sales lead time, if you try to specify a requested shipping date that falls before the first possible date, the system warns you and asks you to find another available date for delivery. The system-proposed ship and receipt dates can be overridden if you click the Disable dlv. date control button. In this case, the system accepts the dates originally proposed, although you cannot force the system to accept a closed date in the calendar or a date in the past.
Coverage Calendar
The coverage calendar for the warehouse is set up for each warehouse. In the coverage calendar, you can set up open and closed days for the warehouse. If the requested shipping date falls on a closed day, then the next open day is used for the requested shipping date. If you do not set up a coverage calendar, the open and closed days for the company are defined in the Company information form on the Shipping calendar.
Procedure: Set Up a Coverage Calendar for a Warehouse

To set up a coverage calendar for a warehouse: 1. Click Inventory management > Setup > Inventory breakdown > Warehouses. 2. Select a Warehouse. 3. Click the Master planning tab. 4. In the Calendar field, specify a calendar to be used as a coverage calendar.
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Order Deadlines
Order deadlines determine the cutoff time after which orders are shipped one day later. Set the order deadlines by clicking Accounts receivable > Setup > Parameters and select the order deadlines in the Order deadlines field group.
EXAMPLE: The Order deadline is set for 12:00 on Wednesday and the sales order is entered at 12:30 on Wednesday. Therefore, the earliest requested shipping date is Thursday, the following day, presuming this is an open day.
Transport Time
Set up transport time between a warehouse in your company and a customer address in the Transport form. This is opened by clicking Inventory management > Setup > Distribution > Transport.
FIGURE 8.4 TRANSPORT FORM
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NOTE: If multisite is activated, ensure that fallback warehouses are associated with the sites. The fallback warehouse is used to calculate the transport time if a site but no warehouse has been specified on the sales order line.
Procedure: Set up Transport Times

To specify the transport shipping point, receiving point, and transport duration, follow these steps. 1. Click Inventory management > Setup > Distribution > Transport. 2. To create a new transport, under the Receiving point section in the Type list, select Address or Warehouse. 3. Leave the remaining fields blank on the upper pane of the form. This will let you see all the current transport possibilities. 4. In the middle pane, create a new line and select the relevant shipping warehouse. 5. Depending on the setting of step 2, on the General tab, select either the receiving warehouse or the receiving point address by selecting, for example, the ZIP/postal Code. 6. You can enter the number of transport days that will be used in master planning when you create planned transfer orders. 7. To add new shipping and/or receiving points, repeat the procedure from step 2. 8. In the lower pane, create a new line and select a mode of delivery. 9. Enter the number of transport days for transport. 10. Repeat from step 8 for all desired modes of delivery. 11. Select the Default check box for the preferred mode of delivery that will be used in master planning when you create planned transfer orders. This will override the Transport days setting in step 6. 12. To add new shipping and/or receiving points, repeat from step 2.
Fallback Warehouse
The Transport form is controlled based on warehouse and not site, even if multisite is enabled. This means that if only the site is specified on the sales order line, the Transport form does not receive the necessary input to calculate and find the correct transport time. The Fallback warehouse for site form is introduced in Microsoft Dynamics AX 2009, where you can specify a fallback warehouse for a site. This means that if only the site is specified on a sales order line, the necessary information for the Transport form is pulled from the fallback warehouse for that specific site instead. Therefore, the Transport form still calculates the transport time based on the individual warehouse settings.
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NOTE: The fallback warehouse settings also apply if transport has only been set up for Warehouse A on a site and Warehouse B is selected on the sales order line.
To set up fallback warehouses, open the Fallback warehouse for site form from Inventory management > Setup > Distribution > Fallback warehouse for site.
FIGURE 8.5 FALLBACK WAREHOUSE FORM
NOTE: On the Company information form, a default fallback warehouse has been specified for the company. So even if a fallback warehouse has not been specified for a certain site, there is always the company default fallback warehouse that will take effect, if necessary. However, this is only used for orders created through the Enterprise portal, AIF, or Intercompany to ensure that the order can be received.
Transport Calendar
Open the Transport calendar from the Modes of delivery form in Accounts receivable > Setup > Distribution. The calendar contains three statuses of the Working times, as shown in the following table. Status Open Closed Closed for pickup Description The mode of delivery is open for pickup and delivery. The mode of delivery is closed for pickup and delivery. This means that the carrier can operate on an open day but does not make pickups from warehouses on that day. This is an important feature because many carriers operate seven days a week but may only pick up items to be delivered on certain days of the week.
The transport calendar lets you operate with two levels of detail: Mode of delivery Warehouse specific
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When you specify a transport calendar for a mode of delivery, the calendar applies for all warehouses for a particular mode of delivery. When you create a transport calendar that is warehouse specific, you create a relation between a mode of delivery and the specific warehouse.
EXAMPLE: The carrier VAN has a transport calendar attached to it called Std. no Friday pickup for the warehouse GW. This means that when a delivery is to be made by the carrier VAN from warehouse GW, the VAN can pick up from warehouse GW on any day except Friday. If you create a sales order with warehouse GW specified on the sales order line and with the carrier VAN specified with a requested shipping date on a Friday, then the requested shipping date is moved to the next day when the carrier VAN is open for pickup.
Procedure: Attach a Calendar to Mode of Delivery for a Specific Warehouse

To attach a calendar to a mode of delivery for a warehouse, follow these steps. 1. Click Accounts receivable > Setup > Distribution > Modes of delivery. 2. Select the Mode of delivery. 3. Click Transport calendar. 4. Specify the Warehouse for which the calendar is valid if you want to create a warehouse relation. Otherwise, leave the field blank. 5. Select the Calendar.
Customer Receipt Calendar

Specify the opening days for the customer in the Customer receipt calendar. You cannot specify that a receipt date falls on a closed date in the customer's receipt calendar. If no receipt calendar is specified for the customer, all days are open days for the customer. To specify a customer receipt calendar, follow these steps: 1. Click Accounts receivable > Customer Details. 2. Click the Setup tab. 3. Specify a Receipt calendar in the Delivery field group.
NOTE: You can set up a receipt calendar for all delivery addresses for a customer.
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Job Aid: Setting Up Transport Times
The following factors depicted in the figure, Setting up Transport Times job aid, affect the available shipping receipt date for a sales order.
FIGURE 8.6 SETTING UP TRANSPORT TIMES JOB AID
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Lab 8.3 - Set Up Transport Times

Contoso Entertainment Systems - Company CEU Scenario As the sales manager for Contoso Entertainment Systems, you are responsible for setting up the new Delivery date control functionality and transport times with regard to an existing customer, Whole Wholesales. The customer's ZIP code is 01199. The standard transport time by Parcel between Contoso Entertainment Systems warehouse 21 and the customer is five working days. This is the default transport time. Specify that when UPS Ground is the mode of delivery from warehouse 21, that the transport time is three working days. Specify that when UPS Next Day Air is the mode of delivery from warehouse 21, that the transport time is only one working day.
Challenge Yourself!
Set up the transport times to the customer for different modes of delivery according to the specifications set in the lab description.
Need a Little Help?

1. Set up the transport times in Inventory management > Setup > Distribution > Transport. 2. Set up a standard transport time by using a default value.
Step by Step
1. Click Inventory management > Setup > Distribution > Transport. 2. In the Shipping point field group, filter on the warehouse 21. 3. In the Receiving point field group, select Address in the Type field. 4. In the Receiving point field group, type 01199 in the ZIP/Postal code field 5. Create a new line in the middle pane and save the record. 6. In the lowest pane, create a new line and specify Parcel as a mode of delivery, and a transport time of five days, and then select the Default check box.
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7. Create a new line, and specify UPS Ground and a transport time of three days. 8. Create a new line, and specifiy UPS Next Day Air and a transport time of one day.
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Available Ship and Receipt Dates

The Available ship and receipt dates dialog box appears if a sales order cannot be delivered on the requested date, considering all the calendars and times you have previously set up.
Available Ship and Receipt Dates Dialog Box

The Available ship and receipt dates dialog box provides an immediate and clear warning if you can deliver a sales order in time to meet the customer's requirements. In the Available ship and receipt dates dialog box, perform the following: View the dates on which you can/cannot ship a sales order in the upper part of the form and the reason why the date is unavailable, for example, the shipping date falls on a closed date in the transport calendar. Take action to resolve the problem, for example, change the mode of delivery for the order.
The most important prerequisite for using the Available dates functionality is that the delivery date control parameter is selected.
Specify and Update Request Dates with the Available Dates Function
When you create a sales order, Microsoft Dynamics AX 2009 calculates the earliest possible ship date and receipt date. The earliest ship and receipt dates depend on the setup created for all the factors previously referred to in the Enhanced Delivery Date Control lesson. If you try to select a requested ship date or requested receipt date that falls before the calculated requested ship date or requested receipt date, the Available ship and receipt dates dialog box appears. The Available ship and receipt dates dialog box in the figure shows the following: Upper pane - What the problem is with the requested ship/receipt date for the selected sales order. In the figure, Available ship and receipt dates form, the requested receipt date cannot be reached because the date does not fall in an open date in the customer calendar. Lower pane - The non-available dates are indicated with a caution icon. These are probably closed days in the calendar and are not displayed at all, and the rest of the dates that are available dates.
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Available Ship and Receipt Dates - Parameters
Use the different parameters and information in the Available ship and receipt dates dialog box to try to meet the requested delivery date and solve the date problem. These parameters are described in the following table. Parameter Mode of delivery Description Change the mode of delivery to reduce the transport time. For example, delivery by AIR is usually faster than delivery by VAN. Therefore, to bring the requested receipt date forward, you can switch the mode of delivery to AIR and simulate what the result will be with regard to available ship dates and available receipt dates. Change the site. Change the warehouse and the number of transport days to be less or more. This enables you to fulfill/not fulfill the requested ship/receipt date. In the sales order header, the lead time comes from the default sales lead time specified on the Accounts Receivable > Parameters form. In the sales order lines, the lead time comes from sales lead time for the item or trade agreements that exist for the item. Shows the number of days it takes to transport items from the shipping point to the receiving point for the given mode of delivery. You can set up the transport days on the Transport form. Shows the order entry deadline at the shipping location converted to your time zone. Shows the order entry deadline at the shipping location in the time zone of the shipping location. If multisite is activated, the time is shown in the site time zone, otherwise it is shown in the company time zone. Available ship date from the shipping point. Available receipt date at the receiving point.
Site Warehouse
Lead time
Transport days
My time Shipping location time
Available ship date Available receipt date
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Transfer New Date
When you have decided which dates to enter in the order, you can transfer the available dates to the sales order. This is useful if you can deliver the order on the requested date. However, if the selected ship or receipt date falls on a closed day and you still want to transfer the date to the sales order, click the Disable dlv. date control button. This function disables the delivery date control and lets you ignore the system calculated date and accept a non-available date.
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Lab 8.4 - Available Dates and Delivery Dates

Contoso Entertainment Systems - Company CEU Scenario You are the order taker at the Contoso Entertainment Systems. Whale Wholesales calls and orders one piece of item number 1701, Standard DVD Player - Black, to arrive Today's date + one week. The sales order must be dispatched from warehouse 21. You hear that one of Contoso Entertainment Systems sales representatives will be visiting Whale Wholesales that day and can personally deliver the order. The delivery can therefore be made today.
Challenge Yourself!
1. Create the sales order according to the specification in the first part of the scenario. 2. Take the appropriate action on the delivery so that the delivery date control is ignored and the delivery date at the customer is for today.
Need a Little Help?

1. Ensure that the Delivery date control parameter is enabled. 2. The arrival date at the customer is the Requested receipt date. 3. Use one of the buttons in the Available ship and receipt dates dialog box to accept the delivery date for Today.
Step by Step
1. Open Accounts receivable > Sales Order Details and then press CTRL+N to create a new Sales order. 2. Select customer account 1301 3. Ensure Delivery date control = Sales lead time, and then click OK. 4. Type 1701 in the Item number field. 5. Ensure that the warehouse 21 is specified on the line. 6. Click the Delivery tab and set the Requested receipt date to Today's date + one week, and then press CTRL+S to save the record. 7. Bring the Requested receipt date forward to Today on the order line. 8. To override the Available dates control, click Disable dlv. date control.
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Order Entry Deadlines

For the multisite feature introduced in Microsoft Dynamics AX 2009, the delivery date control feature has been improved by introducing the possibility of specifying order entry deadlines for each site and the consideration that sites might be located in different time zones. This deadline in Microsoft Dynamics AX 2009 is termed Order entry deadline. The order entry deadline is defined for each site according to the time zone that the site is located in and not the time zone where sales orders are created. In addition, it is possible to allow for certain important customers to have later order entry deadlines than all other customers. In many companies, a sales order must be received before a certain time of day for the sales order to be treated as if it is received that day. If the order is received after this deadline, the company treats the sales order as if it is received the next business day.
Scenario: Order Entry Deadlines

Susan, the order processor, sets up order entry deadline times for all the days of the week in the Order entry deadlines form. If an order is received after this time, it will be treated as if it is received the next day. By default, these times are set to 23:59, that is, one minute to midnight at the end of the relevant day. Susan can change the default times so that they coincide with actual ship deadline times. Susan can also define order entry deadlines for a specific group of customers, for example, if she wants to enable a group of specific customers to have order entry deadlines later than most customers. First, Susan defines order entry deadline groups in the Order entry deadline groups form. Second, she assigns the order entry deadline groups to customers in the Customers form. Third, she sets up the order entry deadline for the group. If the company consists of several sites, the order entry deadlines, the order entry deadline groups, and time zones can be set up for each site. If the sites are located in different time zones, the order entry deadline is set up in the site time zone. However, with sales orders and sales quotations, the order entry deadline is converted to the user's time zone in the Available ship and receipt dates dialog box. The permitted combinations of site and order entry deadline group are defined in the Activate order entry deadline combinations form.
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Example: Order Entry Deadline
Suppose that today is Tuesday and the time is 17:00. If Susan, the order processor, sets the order deadline to 16:00 on Tuesday and tries to set the ship date as today's date (assuming zero lead time), she will receive a warning that the date is invalid if the Sales lead time or ATP is selected in the Delivery date control field. This warning will appear on the Available ship and receipt dates dialog box on which alternative dates can be chosen.
Example: Different Order Entry Deadline for Each Site

A company consists of two sites. The sites are located in two time zones. This is an example where two sites have different order entry deadlines. Site A California Pacific Standard Time (PST) Site B Florida Eastern Standard Time (EST)
Site A and B have defined the following order entry deadlines. Order entry deadlines Monday Tuesday Wednesday Thursday Friday PST 13:00 13:00 13:00 13:00 13:00 Order entry deadlines Monday Tuesday Wednesday Thursday Friday EST 14:00 14:00 14:00 14:00 14:00
Susan, the order processor, is located in Utah where the time zone is Mountain Standard Time (MST). This means that as long as she creates orders with site A before 14:00 MST and with site B before 12:00 MST, she meets the order entry deadlines for both sites. The following table shows the order entry deadlines for site A and B converted to MST time. Site A (PST) 13:00 MST 14:00 Site B (EST) 14:00 MST 12:00
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Example: Same Order Entry Deadline for Each Site
A company consists of two sites. The sites are located in two time zones. This is an example where two sites have same order entry deadline. Site A California Pacific Standard Time (PST) Site B Florida Eastern Standard Time (EST)
Site A and B have defined the following order entry deadlines. Order entry deadlines Monday Tuesday Wednesday Thursday Friday PST and EST 13:00 13:00 13:00 13:00 13:00
Susan, the order processor is located in Utah where the time zone is Mountain Standard Time (MST). This means that as long as Susan creates orders with site A before 14:00 MST and with site B before 11:00 MST, she meets the order entry deadlines for both sites. The following table shows the order entry deadlines for site A and B converted to MST time. Site A (PST) 13:00 Site A (MST) 14:00 Site B (EST) 13:00 Site B (MST) 11:00
NOTE: If daylight savings time adjustment is in effect, the order entry deadlines are adjusted accordingly.
Procedure: Set Up Order Entry Deadlines

To specify order entry deadlines for each site and order entry deadline groups, follow these steps: 1. Click Inventory management > Setup > Distribution > Order entry deadline. 2. In the Site field, specify if you want order entry deadlines to apply to a specific site or to all sites.
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3. Select a site in the Select field if you have selected Specific in the Site field. 4. In the Order entry deadline group field, specify if you want order entry deadlines to apply to a specific order entry deadline group or to all order entry deadline groups. 5. Select an order entry deadline group in the Select field if you have selected Specific in the Order entry deadline group field. 6. Type order entry deadline times in each day of the week fields.
NOTE: If an error icon appears next to the line, the order entry deadline combination is not activated.
Procedure: Create an Order Entry Deadline Group

Use the following steps to define order entry deadlines for sites or groups of customers. First, create order entry deadline groups and then associate the order entry deadline groups that have sites or customers. 1. Click Inventory management > Setup > Distribution > Order entry deadline groups. 2. Press CTRL+N to create a new group. 3. Type a group name in the Order entry deadline group field and type a description of group in the Description field.
Procedure: Assign an Order Entry Deadline Group to a Customer

To assign an Order entry deadline group to a customer, follow these steps. 1. Click Accounts receivable > Customer details. 2. Select the customer to whom you want to assign an order entry deadline group. 3. Click the Sales order tab and select an order entry deadline group in the Order entry deadline group field.
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Procedure: Assign an Order Entry Deadline Group to a Site
To assign an Order entry deadline group to a site, follow these steps. 1. Click Inventory management > Setup > Inventory breakdown > Sites. 2. Select a site to which you want to assign an order entry deadline group. 3. Click the General tab and select an order entry deadline group in the Order entry deadline group field.
Procedure: Activate Combinations of Order Entry Deadline Groups and Sites

To activate combinations of order entry deadline groups and sites, follow these steps: 1. Click Inventory management > Setup > Distribution > Activate order entry deadline combinations. 2. Select the check boxes that correspond to the combinations that you want to activate. Order group Site Select this combination if you want order entry deadlines to apply to a specific site and a specific order entry deadline group. Select this combination if you want order entry deadlines to apply to all sites and a specific order entry deadline group. All order groups Select this combination if you want order entry deadlines to apply to a specific site and all order groups. The all sites and all order entry deadline groups combination is always activated and cannot be deactivated.
All sites
The selected combinations will be available in the Order entry deadlines form.
Create a Sales Order in a Multi Time Zone Environment

With Microsoft Dynamics AX 2009, you can specify the sales order lead time to be site specific on the sales order lines. This means that if the site is activated, the sales order lead time used for calculating the requested ship date or confirmed ship date can be site specific on the sales order lines. If site is not activated, the sales order lead time is found from the item.
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Example
A sales order and a sales order line for item B-R14 is created for a customer. The date is December 6, 2007. You set up one transport day to the customer receipt address. Additionally, the following requested ship and receipt dates are specified on the sales order line: Requested ship-date is December 12, 2007 Requested receipt date is December 13, 2007 Confirmed ship-date is December 12, 2007 Confirmed receipt date is December 13, 2007
The following table displays the setup for this example. Sites and warehouses Items Multisite is activated Site A has warehouse GW associated with it On item B-R14, sales order lead time on Default order settings > Sales order tab is six days On item B-R14, a sales order lead time is set up for site A on Site specific order settings > Sales order tab. The sales order lead time for site A, when you are selling item B-R14, is seven days. Order entry deadline is 23:59 for all days, for all entities. Transport from warehouse GW to all countries/regions using the UPS mode of delivery is one day. Transport from warehouse MW to all countries/regions using the UPS mode of delivery is one day.
Miscellaneous
Example: If Site B is Selected on the Sales Order Line

If you select Site B on the sales order line, there is no specific sales order lead time set up for site B. This means that in the calculation, Microsoft Dynamics AX 2009 falls back to the sales order lead time on the item, which is six days. The earliest possible ship date for Site B is then December 12, 2007 (December 6 + sales order lead time for Item = December 12, 2007). Because December 12, 2007 is before or equal to the confirmed ship date provided on the sales order line, nothing is changed to the requested ship and receipt dates: Requested ship-date is December 12, 2007 Requested receipt date is December 13, 2007
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Confirmed ship-date is December 12, 2007 Confirmed receipt date is December 13, 2007
NOTE: As soon as the confirmed ship date is provided, no changes are made to the requested ship dates. Then all changes and calculations are made to the confirmed dates only. This is so that users can keep track of what the customer originally requested.
Example: If Site A is Selected on the Sales Order Line

If you select Site A on the Sales Order Line, the sales order lead time has already been set up for site A, and for item B-R14, the sales order lead time is seven days. The earliest possible ship date for Site A is December 13, 2007 (December 6 + sales order lead time for Item = December 13, 2007). Because December 13, 2007 is after the confirmed ship date on the sales order line, the delivery date control feature opens the Available ship and receipt dates form.
NOTE: The lead time displayed in the Available ship and receipt dates form is the specific sales order lead time for site A.
Direct Delivery
Microsoft Dynamics AX 2009 supports direct delivery to customers. With direct delivery, sales orders are delivered directly from the vendor to the customer without physically entering your company's inventory. The direct delivery functionality in Microsoft Dynamics AX 2009 has the following advantages over the traditional non-direct delivery distribution supply chain: Reduced time from when you create sales orders to the delivery to the customer. No inventory carrying or labor costs as the items never physically enter inventory. Reduced transportation costs since the items go directly from the vendor to the customer. Reduced administration time and less chance of order entry error because purchase orders are directly created from the sales order and there is a single point to update delivery/receipt of orders.
Scenario: Create and Process Direct Delivery Orders

A customer has ordered items for receipt one week from next Wednesday. The order taker at Contoso Entertainment System checks to see whether they currently have enough of these items in stock but finds they do not.
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However, the vendor for these items resides in the same town as the customer. Therefore, the order taker decides to create a direct delivery from the vendor to the customer to save unnecessary freight costs and shorten the delivery time.
Procedure: Create a Purchase Order for Direct Delivery from a Sales Order
Creating a sales order of the type direct delivery works exactly like the Create purchase order function, except that the customer's delivery address is transferred to the purchase order instead of the company's address. To create a purchase order of direct delivery from the sales order, follow these steps: Click Accounts receivable > Sales Order Details. Create a sales order or select an existing sales order. Create a sales order line and specify the Item and Quantity. In the Sales order header, click Functions > Create direct delivery. 5. Select which sales order lines must be delivered directly. Select all lines for inclusion by selecting the Include all check box. 6. Click OK. A purchase order is created and the delivery address is transferred to the purchase order. 1. 2. 3. 4.
Update a Sales Order/Purchase Order of the Type Direct Delivery

When you create a sales order for direct delivery, all posting updates from the sales order are unavailable, except the Confirmation. All posting updates concerned with delivery of items to the customer, except Confirmation, are performed from the purchase order. This ensures that packing slip updates for the purchase order and its attached sales order are synchronized. Synchronization between orders reduces the probability of: Order takers updating the purchase order's packing slip order but not the sales order packing slip. Delays between updating the purchase order and sales order. The purchase order being updated against the wrong sales order. The wrong quantities being updated between the purchase order and sales order.
By using this synchronized updating process, you ensure that packing slip updates of purchase orders are reflected in the update of the attached sales order.
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Other Updates of Purchase Orders and Sales Orders
The following table provides an overview of other types of posting and how they are synchronized between the purchase order and sales order in a direct delivery scenario. Update Purchase order posting updates for Purchase order and Receipt list updates Picking list updates Note Perform these as for a standard purchase order; these updates do not affect the status of an attached sales order. With direct deliveries, no picking list is created since the items sold to the customer never physically enter your inventory and are therefore never picked. Posting options are available to perform updates for the order lines of the type non-direct delivery. However, posting options are unavailable for lines of type direct delivery.
Sales orders with lines of both the types direct delivery and non-direct delivery
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Process Flow - Direct Delivery
The figure, Process Flow in a Direct Delivery Sales Order, shows the process flow in a direct delivery sales order from the customer's initial call through the final invoicing of the sales order.
FIGURE 8.7 PROCESS FLOW IN A DIRECT DELIVERY SALES ORDER
Updating Sales Orders

When you update a Sales order/Sales order lines, corresponding updates appear on the attached Purchase order/Purchase order lines. Scenario A day later, the customer calls to say that they want their item delivered to another address. The order taker enters the new delivery address in the sales order line and the corresponding purchase order line is updated. Additionally, the customer requests that the delivery date be set back by one week and the order quantity increased by 100 to 1100 pieces of each item. These changes are updated on the purchase order. Finally, the customer orders 200 pieces of another item, and creates this order line as a direct delivery on the same sales order. However, this time, the corresponding purchase order line is not added to the existing purchase order of the type direct delivery but created as a new purchase order and purchase order line.
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Later in the day, you inform the vendor of the updated delivery address, the change in delivery date, order quantity, and the order for the additional items.
Update Sales Orders - Reactions on Purchase Order

The following table shows the action on the sales order and the reaction on the corresponding purchase order: Action on sales order line of type direct delivery Update the address Update the requested shipping date Update the quantity Delete sales order line Create a new sales order line of type direct delivery Reaction on corresponding purchase order line of the type direct delivery Address updated on corresponding purchase order line. Delivery date updated on corresponding purchase order line. Quantity updated on corresponding purchase order line. Select if the corresponding purchase order line is to be deleted. A new purchase order of direct delivery is created in the Purchase orders form.
Updating Purchase Orders

When you update a Purchase order/Purchase order lines, corresponding updates appear on the attached Sales order/Sales order lines. Scenario The order taker receives notification that five items have been delivered to the customer, and then partly updates the purchase order packing slip. The sales order is correspondingly updated. When the customer receives the five items, they call Contoso Entertainment Systems and say that they want the remaining quantities for all items delivered to a new address at 123 Petunia Street, London. The order taker updates the purchase order header with the new delivery address and is prompted if the attached purchase order lines, which also had the previous address specified on them, are also to be updated with the new address. Because all the remaining items must be delivered to the address, the order taker clicks Yes to all. The attached sales order line is updated. Eventually, the purchase order is fully updated and the customer is invoiced from the sales order.
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Update Purchase Orders - Reactions on Sales Orders
The following table shows the action on the purchase order and the reaction on the corresponding sales order: Action on purchase order line of type direct delivery Update part delivery of a purchase order line Update Confirmed delivery date on Purchase order line Update delivery address on Purchase order header Update delivery address on purchase order line Reaction on corresponding sales order line The delivered quantity is updated in the sales order line. Confirmed ship date on sales order line is updated. An Info log appears that asks whether the delivery address on the sales order line must be updated. Delivery address on sales order line is updated.
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Lab 8.5 - Direct Delivery

Contoso Entertainment Systems - Company CEU Scenario Day 1: Forest Wholesales calls and orders 1,200 pieces of item number 1507. The order taker at Contoso Entertainment Systems sees that there are not enough of item number 1507 in stock and decides, given the geographical closeness of the vendor to the customer and the urgency of the order, to create a sales order of direct delivery. Day 2: Forest Wholesales calls and changes the delivery address of the sales order to Main warehouse, Gate 3. Day 6: You receive notification from the vendor that 500 of the 1,200 pieces of 1507 have been delivered so you post the Purchase order packing slip. Day 7: Forest Wholesales calls and requests that you add a sales order line for ten pieces of item number 1509.
Challenge Yourself!
1. Create the sales order as specified in Day 1 of the scenario. 2. Update the delivery address as specified in Day 2 of the scenario. 3. Update the Purchase order according to the delivery specified on Day 6 and then post the Purchase order packing slip. Consider what happens to the attached Sales order. 4. Create the order for the item number 1508 as specified in Day 7 of the scenario. Create it as a direct delivery and consider what happens to the purchase order.
Need a Little Help?

1. To create an order of type Direct delivery from the sales order header, click Functions > Create direct delivery. 2. For the update on Day 2, perform the following steps: a. Update the Delivery address on the Sales order. b. Open the attached Purchase order and ensure that the Delivery address is updated. 3. For the update on Day 6, perform the following steps: a. In the Purchase order line, on the Quantity tab, in the Receive now field, specify the quantity to be received. b. Click Posting > Packing slip. c. In the Quantity list, select Receive now.
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d. Click OK, and close the Purchase order. e. Press CTRL+S in the Sales order form and click the Quantity tab. 4. For the update on Day 7, perform the following steps: a. Create a new sales order line for item number 1508 b. Use the References tab on the Sales order to see the attached purchase orders.
Step by Step
1. Create a sales order for customer 1101 for 1,200 pieces of item number 1507. 2. Click Functions > Create direct delivery. The line is automatically created that has the preferred vendor. Select the Include check box and the direct delivery purchase order is created, when you click OK. 3. Update the sales order header with the new address. 4. Click Inquires > Purchase order and select the Address tab to see the updated address on the Purchase order. 5. In the Receive now field of the purchase order line, update with 500 pieces. 6. Click Posting > Packing slip and select Receive now. Type a Packing slip number and then click OK. 7. Close the Purchase order, and press CTRL+S in the Sales order form. 8. Click the Quantity tab to ensure the 500 pieces have been delivered. 9. Create a new line for the sales order of 10 pieces of item number 1508, and create a purchase order of the type Direct delivery from the line. Notice that in the Create direct delivery form, you can only select the new line for 1508 for creation because the line for 1507 has already been created. For the new sales order line for item number 1508, a new purchase order of direct delivery type is created. You can see this on the References tab of the Sales order.
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Sales Order Posting

You can apply various posting techniques and processes when working with sales and orders in Microsoft Dynamics AX 2009. Inventory posting profiles, Customer posting profiles, sales tax, and miscellaneous charge profiles control which ledger accounts are used and when they are used when you sell from inventory. When you post a packing slip or invoice, you post to the general ledger and subledgers. Profiles for posting to the general ledger can be set up for: One item An item group All items at the same time Customer (table, group, all) Sales tax Miscellaneous charges
You can learn about the hierarchy of Sales order posting and how the system searches through the profiles, in the Sales Order Posting Hierarchy topic. The following lessons introduce updating sales orders through the five posting statuses that are available in Microsoft Dynamics AX 2009. These are the postings options: Confirmation Picking list Picking list registration Packing slip Invoice
The ability to use all order postings depends on the specific needs of a company.
NOTE: In Microsoft Dynamics AX 2009, you also have the option to use the Pro-forma button in the Sales order form to go directly to the posting forms for all posting updates. This means that the Posting check box will be inactivated by default, and pro-forma papers can be printed.
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Post a Sales Order Confirmation

After you create a sales order, you will post the sales order confirmation to confirm the details of the order and print the hard copy of the sales order for the customer. The business needs of the company determine whether this posting update is necessary. The confirmation is useful when a customer is only committing to part of a proposed order but has not declined the other proposed items or quantities. This step does not change the status of the order and does not create any inventory transactions. The Document status is updated to Confirmed and the system creates a Confirmation journal.
Procedure: Post a Sales Order Confirmation

To post a sales order confirmation, follow these steps. 1. Click Accounts receivable > Sales Order Details > Advanced view. 2. Select the sales order to post. 3. Click Posting > Confirmation. 4. In the Quantity field, select the appropriate setting. 5. Click OK to post the order confirmation.
Posting Confirmation Form - Print Options Field Group

In the Print options field group, select the printing options for confirmation. Specify if you want to print the confirmation and whether to use the Print management system. The print management system, in regard to the sales order, works the same for purchase orders.
Posting Confirmation Form - Parameters Field Group

The Parameters field group contains three check boxes that control what is to be posted and when. The parameters are: Quantity Posting Late selection
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FIGURE 8.8 POSTING CONFIRMATION FORM
Posting Confirmation Form - Quantity Field

In the Quantity field, specify the quantity with which you want the order updated. How update quantities works resembles the Quantity settings in the purchase order updates, except that sales order quantities deal with the issue of items instead of their receipt. Quantity Deliver now Description Use this option when partly updating a sales order delivery quantity. On the Quantity tab in the Deliver now field, enter the quantity to be updated. When the sales order is updated, the quantity on the sales order line in the Deliver now field is pulled into the posting as a proposed quantity. When this function is used, the total sales order quantities are proposed in the posting lines. With a Confirmation update, the complete quantity is the proposed quantity when Picked is selected. With a Confirmation update, this has the same effect as selecting the All setting.
All Picked Packing slip
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Posting Confirmation Form - Posting and Late Selection
Specify the settings from the following table in the Parameters field group. Setting Posting Description Select to post the confirmation. Clear this field to create a pro forma confirmation. Creating a pro forma confirmation is useful if you want to view and review the confirmation before you send it to the customer. Clear the parameter unless you intend to process the order at a later date through a batch. EXAMPLE: This field can be used for pre-orders in the apparel industry. In the apparel industry, companies must pre-order garments more than six months before taking delivery. With such a lengthy time between order entry and actual delivery, it helps to delay processing the order.
Late selection
Posting Confirmation Form - Other Tab

The Other tab has two field groups: Setup Summary update
In the Setup field group, start a credit check on the customer and set a deadline date to delimit the transaction.
FIGURE 8.9 POSTING CONFIRMATION FORM - OTHER TAB
Procedure: Perform a Credit Check at any Stage of a Sales Order

To perform a credit check at any stage of a sales order, follow these steps. 1. Click Accounts receivable > Sales Order Details. 2. Select a sales order.
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3. Click Posting > Confirmation. 4. Click the Other tab and specify the type of check that you want to run. The default setting for this field comes from the Credit limit type field in Accounts receivable > Setup > Parameters, although you can override the setting in the update itself.
Check Credit Limit Options

These are the options available when you run the Check credit limit check when you post a sales order, as indicated in the following table. Credit limit type None Description No credit limit check is performed unless a setting is selected in Accounts receivable > Setup > Parameters > Check credit limit for a sales order . If this is the case, a credit limit check is performed when you create the order. A credit limit check is performed against the balance for a customer. EXAMPLE: In Accounts receivable > Setup > Parameters > Credit rating tab, the Check credit limit for sales order is set to None. A customer has a credit limit of 1,000.00 USD, but has a balance of 600.00 USD. You have also sold one unit of CL-100-B-R to the customer who has a line amount of 600.00 USD. However, the order has only been packing slip updated. Finally, there is an open order for 20 pieces of B-Uad with a line amount of 10.80 USD. When you perform a Confirmation update for the open order, select Balance in the Check credit limit field. Because the credit limit check is only run against the balance for 600.00 USD, no warning or error is generated. Balance+Packing slip A credit limit check is performed against the invoiced balance for the order and the value for any packing slip updated order. EXAMPLE: Use the same set of orders as in the Balance example and perform a Confirmation update, and in the Check credit limit field, select Balance+Packing slip. This time Microsoft Dynamics AX 2009 generates a warning that the credit limit has been exceeded by 210.80 USD , which is the balance amount, the packing slip amount, and the value of the current order minus the credit limit amount.
Balance
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Credit limit type Balance+All
Description A credit limit is performed against the invoiced balance, the value of any packing slip updated orders and any open orders. Use the same set of orders as in the Balance example and add an additional order with the customer for 20 pieces of B-Uad. Perform a Confirmation update, and in the Check credit limit field, select Balance+All. The credit limit is now exceeded by 221.60 USD, which is the balance amount, the packing slip amount, and the summed amount for the two open orders for B-Uad minus the credit limit amount.
NOTE: If you run a credit limit check on the order and the credit limit is exceeded, a warning or an error is generated, with a warning you can still continue with the update. Specify whether a warning or an error must be generated by clicking Accounts receivable > Setup > Parameters and selecting either Warning or Error.
Posting Confirmation Form - Summary Update

Summary update in sales orders works similarly to summary update for purchase orders. In the following table, you can see how summary updating works for sales orders in regard to the various summary update settings. Setting None Invoice account Description No summary updates will be made. This means one order and one confirmation. Summary update selected sales orders by their invoice account. EXAMPLE: You select four sales orders for update and of these four, two have one invoice account specified for them and the other two have another invoice account specified for them. If you Invoice account summary update the orders, two updates are created, one for each invoice account. Order A selected range of orders will be consolidated into one confirmation. If order is selected, you must also set the Order error tolerance on the same page. The automatic summary function works the same as for purchase orders except that sales orders are summarized. You must set up summary update for each document on the customer in the Customers form, by using Setup > Summary update.
Automatic summary
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Posting Confirmation Form - Lower Panel
The lower panel of the Posting confirmation form contains five tabs: Overview Setup Lines Line details Sales orders
Posting Confirmation Form - Overview Tab

On the lower panel of the Posting confirmation form, you can review the details on the Overview tab to ensure that you are processing the correct sales order. The yellow caution triangle or tick indicates if an order can be updated. For example, if you select Deliver now in the Quantity field, but have not specified a quantity in the Deliver now field in the sales order, the yellow caution triangle displays because there is no quantity to update. Notice that this is a high level validation and only indicates if the order will post or not.
Posting Confirmation Form - Setup Tab

On the Setup tab of the Posting confirmation form, you can enter the Date of confirmation date if it differs from today's date.
EXAMPLE: The Date of confirmation can help if inventory requires a manual check or when an order processor has to check with another supplier before confirming the order.
Posting Confirmation Form - Lines and Line Details Tabs

When you select the Lines tab, you can review that the items and quantities are correct. Click the Inventory button to access functions such as picking and reservation from the update for the line. You can view additional details on each line by selecting the Line details tab. When you are satisfied that all sales order, item criteria, and quantities are correct, click the OK button to post the order confirmation.
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Post a Sales Order Picking List

The second step in updating sales orders is to post the sales order picking list. When you run a picking list update, it is either voluntary or mandatory depending on the inventory model attached to the item you are selling. If the Picking requirement parameter is selected in Inventory management > Setup > Inventory > Inventory model group, the transactions for a line must have the status Picked before you can continue to packing slip update the line.
Picking List Posting and Parameters

The ability to use the Picking requirement function depends on if you use the Warehouse management (WMS) functionality. When WMS is not used, the picking process depends on the setting in the Picking route status field in Accounts receivable > Setup > Parameters.
FIGURE 8.10 ACCOUNTS RECEIVABLE PARAMETERS - UPDATES TAB
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The settings in the Picking route status field are explained in the following table. Setting Activated Effect You must run both a Picking list update and then register what you have actually picked in the Picking list registration update. In this situation, the status for the transaction only reaches Picked after you have also registered the pick. After this, the packing slip can be updated. Select Completed if the inventory transactions should be updated to Picked when you perform the Picking list update.
Completed
Procedure: Quick-Post and Print a Picking List

Follow these steps to quick-post and print a Picking list from a sales order: 1. Click Accounts receivable > Sales Order Details > Advanced view. 2. Select the sales order to post. 3. Click Posting > Picking list. 4. In the Quantity field, select All. 5. Select the Posting and Print picking list check boxes to post and print the picking list. 6. Click OK to post the picking list.
Posting Picking List Form - Parameters Tab

The posting and printing options for posting and printing a picking list are almost the same as the options for posting and printing a Confirmation. Additionally, on the Parameters tab, you can select or clear the Reduce quantity check box. Selection status of Reduce quantity Selected Effect You can select the Reduce quantity check box to reduce the quantity to be picked to the available on hand quantity of the item. This solves the problem of picking lists being printed for order lines where quantities of the item are not in stock. Instead, a picking list is only generated for available quantities of the item. The order will remain unpicked until it can be picked completely.
Clear
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Posting Picking List Form - Other Tab
In addition to the settings available on the Confirmation update, on the Other tab of the Posting picking list, you will find a Reservation parameter. Status of Reservation parameter Selected Clear Effect When you run a Picking list update, items are automatically reserved. When you run the Picking list update, items will not be reserved. If the nonreserved but picking list updated items are part of the on hand inventory quantity for a sales order line shown in the Release sales order picking form, the quantity is shown in the form as having the status of Picking list not reserved. This status has implications for which quantities of items can be picked for other sales order lines.
Post a Picking List Registration

When the Picking route status field is set to Activated in Accounts receivable > Parameters, you can perform a Picking list registration after you post the Picking list to register the physical pick of the sales order and have a tighter control of where the sales order is in the order process.
Procedure: Perform a Picking List Registration

To perform a Picking list registration, follow these steps: 1. Open Accounts receivable > Sales Order Details 2. Select a sales order that has been Picking list updated. 3. Click Posting > Picking list registration, and the Picking list registration form opens. 4. Select the Mark check box on the sales order line that you want to register the pick for. 5. Update the Pick quantity field, if you are not registering the complete quantity of the sales order line. 6. Click Updates and then select Update selected, or Update all 7. Close the Picking list registration form. Now you are ready to go to the next step in the sales order posting flow, which is posting the Packing slip.
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You will learn more about Picking list registration in the Sales Order Picking course in the Microsoft Dynamics AX 2009 Trade and Logistics 1 series.
Post a Sales Order Packing Slip

When the item is ready to ship to the customer, you post a packing slip. When you have posted the packing slip, the system recognizes that the sales order demand has been satisfied and reduces the physical on hand inventory, if you have not performed the Picking list registration. If Picking list registration is performed, it is at that time that the system will reduce the physical on hand inventory.
Procedure: Quick-Post a Sales Order Packing Slip

Follow these steps to quick-post a sales order Packing slip. 1. Click Accounts receivable > Sales Order Details > Advanced view. 2. Select the sales order to post. 3. Click Posting > Packing slip. 4. In the Posting packing slip form, in the Quantity field, select the All option. 5. Select the Print packing slip check box to print the packing slip. 6. Click OK on the Posting dialog box. If the quantities posted on the packing slip update equal the ordered quantities, the value in the sales order Status field changes to Delivered. If there is a back order on one or more items, the sales order status remains Open order.
Posting Packing Slip Form - Parameters Tab

The settings on the Parameters tab for the packing slip update are primarily the same as the options for the Confirmation update with some exceptions that are listed in the table. Field Quantity Description When you select the Picked option from the list, any quantities on the sales order lines that have been picked become the proposed quantity for packing slip updating. You can select this parameter to reduce the quantity to be packing slip updated to the quantity available on hand. This works the same as the Reduce quantity parameter in the picking list update, except that the parameter applies to quantities for packing slip update.
Reduce quantity
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Posting Packing Slip Form - Others Tab
The settings on the Others tab for the packing slip update are primarily the same as the options for the Confirmation update, with some exceptions that are listed in the table. Field Credit correction Description You can indicate whether a particular update is a correction to a transaction. Select the Credit correction check box to post the ledger transactions equal to the debit note ledger transactions, except for the sign. If the transactions are not equal, the debit note postings are mirrored when you post the credit note. This is used for sales orders with the type Returned order or for credit notes. Credit correction is used to track and account for a return order, if there are incorrect or damaged goods being received. Select this check box to display, for example, a credit note as debit in your voucher transactions. Credit remaining quantity You can select this if your customer wants returned quantities to be updated to open order line quantities (back orders). If your customer does not want a new delivery of the returned items, do not select this option. EXAMPLE: You create a sales order with a customer for ten pieces of an item and invoice-update the order. Two days later, the customer calls to complain that two of the ten items are defective. You credit the customer's account by entering -2 in the Deliver now field. Then, you click Posting > Packing slip, and in the Quantity field, select Deliver now. On the Other tab, select the Credit remaining quantity check box. When you packing slip update the negative quantity, the remaining quantity remains open for delivery at a later date. You can see this in the order header's Status field as the order status is updated to Open order. If the Credit remaining quantity field had been clear, the order status remains at Delivered and there is no back order quantity to deliver. This functionality works in similar way for Invoice updating, except that when the parameter is clear, the status remains at Invoiced and not Delivered.
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Posting Packing Slip Form - Bill of Lading
In the Posting packing slip form, there is an additional tab for Bill of lading information if the Bill of lading parameter is set to Packing slip update. On the Bill of lading tab, enter the shipment details for the order.
FIGURE 8.11 POSTING PACKING SLIP FORM - BILL OF LADING TAB
Using Bill of lading is controlled by Accounts receivable > Setup > Parameters on the Shipments tab in the Bill of lading field group. This indicates when the bill of lading will be created. The options for Bill of lading in the Accounts receivable parameters are shown in the following table. Point at which Bill of Lading is processed None Packing slip update Description No bill of lading will be processed. Microsoft Dynamics AX 2009 will generate a bill of lading when you update the sales order. To locate the bill, in the Sales order form, click Inquiries > Packing slip > Bill of lading. Microsoft Dynamics AX 2009 does not generate a bill of lading when updating the sales order and you cannot post a packing slip. However, when the system generates the invoice, the bill of lading is created. The bill of lading is processed when you post the packing slip or post the invoice. If you do not post a packing slip, Microsoft Dynamics AX 2009 generates a bill of lading when you post the invoice. If you post a packing slip, Microsoft Dynamics AX 2009 generates the bill of lading only when you post the packing slip.
Invoice posting
Both
Other bill of lading settings default from Accounts receivable > Setup > Parameters > Bill of lading field group to the Bill of lading tab on the Posting packing slip form.
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The Freighted by settings from the Bill of lading tab is transferred to the sales order packing slip. The other settings from the tab are transferred to the Bill of lading form and Bill of lading report. There is an additional button for Shipment information. When you click the Shipments button in the Posting packing slip form, you can enter shipment specifications such as volume, weight, number of pieces, and the number of shipping documents required.
Posting Packing Slip Form - Lower Panel

The settings in the lower panel of the Posting packing slip form resemble other sales order updates. However, on the Setup tab, you can enter the Packing slip date if this differs from today's date.
EXAMPLE: If the item was dispatched yesterday but the sales order packing slip update was performed the day after, the packing slip will be updated with yesterday's date, that is, the date the item was physically dispatched from the company. This situation may occur where the physical dispatch of items and packing slip updates occur asynchronously because the two processes are performed in separate departments.
Post a Sales Order Invoice

The last step in the sales order processing is to post and print the Sales order invoice.
Procedure: Quick-Post a Sales Order Invoice

To quick-post a sales order invoice, follow these steps: 1. Click Accounts receivable > Sales Order Details > Advanced view. 2. Select the sales order to post. 3. Click Posting > Invoice. 4. In the Posting invoice form in the Quantity field, select the All option. 5. Select the Print invoice check box to print the invoice. 6. Click OK. If the quantities posted on the invoice update are equal to the ordered quantities, the value in the Status field changes to Invoiced.
HINT: In Accounts receivable > Setup > Parameters > Updates tab, select Delete order line invoiced in total and Delete order after invoicing to delete the sales orders or order lines from the Sales order form when they are fully invoiced.
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Posting Invoice Form - Upper Panel
Most of the settings in the upper panel of the Posting invoice form are the same as for the other updates. However, the following table highlights the differences between the invoice posting update and the other sales order updates. Field Quantity Description Select the Packing slip option and any quantities on the sales order lines that have been packing slip updated will be included for posting. Select this parameter to reduce the quantity to be invoice updated to the quantity that is physically available. Use the function to minimize administration of invoices to the same customer. Remember that you must set up summary update for each document on the customer. EXAMPLE: Your company is sending four orders in one shipment. By using summary update, you can select all four orders and summary update the customer's invoice account. This requires only one update instead of four separate updates, and one invoice will be generated for that customer. Bill of lading This tab appears if you have selected in Accounts receivable > Setup > Parameters that a bill of lading must be generated at invoicing or at packing slip update and invoice update. The bill of lading functionality has similar functionality as when it is created for the packing slip update.
Reduce quantity
Summary update
Posting Invoice Form - Lower Panel

The lower panel settings in the Posting invoice form resemble the other types of sales order posting. However, the following fields have special relevance for invoice posting. Field Invoice date Due date Description Enter a value in this field if it differs from today's date. Specify a due date for payment if the date differs from the payment date calculated according to the terms of payment for the customer. Specify a bank account if the customer has instructed you to use a specific bank account instead of the regular one that you use with that customer.
Bank account
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Lab 8.6 - Post a Sales Order

Contoso Entertainment Systems - Company CEU Scenario As an accounts receivable clerk at Contoso Entertainment Systems, you have been asked to create and invoice three sales orders for three customers, with all orders invoiced to the same customer. These are the details: One Sales order for 50 pieces of item number 1701, sold to Whale Wholesales (Customer number 1301) One Sales order for seven pieces of item number 1702, sold to Forest Wholesales (Customer number 1101) One Sales order for three pieces of item number 1508, sold to Sunset Wholesales (Customer number 1102) Invoice account for all three customers: 1101
Challenge Yourself!
1. Set up summary invoicing at the customer and parameter levels. 2. Create the sales orders, and pick each sales order line. 3. Invoice-update the orders and ensure that the fewest number of invoice-update documents are created.
Need a Little Help?

1. Set up summary invoicing on the Summary update tab for the Accounts receivable module in the Parameters form. 2. Enable summary invoicing on each customer. 3. When you use a different Invoice account, do not transfer customer data. 4. Pick the sales orders before you post the invoice.
Step by Step
1. Cick Accounts receivable > Setup > Parameters > Summary update tab. 2. In the Default values for summary update field, select Automatic summary. 3. Close the Accounts receivable parameters form. 4. Click Accounts receivable > Customer Details. 5. Click Customer number 1301, and then click Setup > Summary update.
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6. Select the Automatic summary check box for Invoice and then close the form. 7. Repeat steps 5 through 7 for Customer numbers 1101 and 1102. 8. Click Accounts receivable > Sales Order Details. 9. Press CTRL+N to create a new sales order. 10. Click Customer number 1301. 11. Click No in response to the prompt. 12. Click the Invoice account arrow, and then click 1101. 13. Click Yes to the prompt. 14. In the Currency field, type USD. 15. In the Mode of delivery field, select Truck. 16. In the Language field, type EN-US. 17. Click OK. 18. Click the arrow in the Item number field and then select 1701. 19. Tab to the Quantity field and type 50. 20. Tab off the field. 21. Click in the header of the Sales order form. 22. Press CTRL+N to create a new sales order. 23. Click Customer number 1101. 24. Click Yes in response to the prompt. 25. Click OK. 26. Click the arrow in the Item number field and then select 1702. 27. Tab to the Quantity field and type 7. 28. Tab off the field. 29. Click in the header of the Sales order form. 30. Press CTRL+N to create a new sales order. 31. Select Customer number 1102. 32. Click No in response to the prompt. 33. Click the Invoice account arrow and then select 1101. 34. Click Yes to the prompt. 35. In the Currency field, type USD. 36. In the Mode of delivery field, select Truck. 37. In the Language field, type EN-US. 38. Click OK. 39. Click the arrow in the Item number field and then select 1508. 40. Tab to the Quantity field and type 3. 41. Click the Sales order header of the first sales order that you created. 42. Click Inventory > Pick. 43. Select the Auto-create check box, and then click Post all. 44. Close the Pick form. 45. Repeat steps 42 through 44 for the second and third sales orders.
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46. Click the Overview pane and SHIFT, and then click the three sales orders you just created. 47. Click Posting > Invoice. 48. In the Quantity field, click the arrow, and then click ALL. 49. Select the Posting check box and the Print invoice check box. 50. Click OK.
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Post an Invoice Based on Packing Slips

The Invoice based on packing slip feature enables the user to post sales order invoices based on a packing slip or a selection of packing slips and/or ship dates. You can also summarize (summary-update) sales order invoices based on the packing slip number. To use the Invoice based on packing slip feature you must select the Deduction requirements parameter on the item's Inventory model group. When this is selected, item deductions must be physically updated before they can be financially updated. You must post a packing slip before the corresponding Sales order invoice can be posted. If there is a difference between the deducted quantity on the packing slip and the negative invoiced quantity on the invoice, an icon is shown in the Packing slip quantity match column in the Posting invoice form.
Post and Print Sales Order Invoices Based on Packing Slips and Date
You can create a sales order invoice based on the packing slip line items that have been shipped to date, even if all the items for a particular sales order have not yet been shipped. You might do this, for example, if your company issues one invoice for each customer for each month that covers all deliveries that you ship during that month. Each packing slip represents a partial or complete delivery of the items on the sales order. When you post the invoice, the Invoice remainder quantity for each item is updated with the total of the delivered quantities from the selected packing slips. If both the Invoice remainder quantity and the Deliver remainder quantity for all items on the sales order are zero, the status of the sales order changes to Invoiced. If the Invoice remainder quantity is not zero, the status of the sales order is unchanged and additional invoices can be entered for it. Inventory transactions are updated with the invoice number, and the status in the sales order Line status field changes to Invoiced.
Procedure: Post and Print a Sales Order Invoice Based on Packing Slips and Date
This procedure assumes that at least one packing slip has been posted for the sales order. The sales order invoice is based on these packing slips and reflects the quantities from them. The financial information for the invoice is based on the information that is entered when you post the invoice. To post and print a sales order invoice based on packing slips, follow these steps. 1. Click Accounts receivable > Sales Order Details. 2. Select one or more sales orders that have had packing slips posted for them.
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3. 4. 5. 6. 7. Click Posting > Invoice. In the Quantity field, select Packing slip. Select the Posting check box. Make selections in the Print options field group as needed. On the Overview tab of the lower pane, select an invoice line and examine the Packing slip field. If an asterisk (*) is shown, multiple packing slips have been posted for this sales order. In the Select packing slip form, review the list of packing slips in the upper pane Overview tab. By default, all posted packing slips for the sales orders are included on the invoice. If the invoice must not include some packing slips, clear the Include check box for those packing slips. Click OK to close the Select packing slip form. Repeat steps 7 through 10 for additional sales orders, if necessary. Click OK. The sales order invoices are posted and printed. In the Sales order form, you can view the status of the sales orders in the upper Overview tab. (Click Advanced to view the upper pane grid, if necessary.) In the lower Lines tab, select a line and then click the Quantity tab to view quantity information.
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9. 10. 11. 12.
NOTE: This procedure can also be completed from the Invoice sales update periodic job. This procedure assumes that at least one packing slip has been posted for the sales orders that are invoiced using the periodic job. The financial information for the invoices is based on the information that is entered when you enter and post the invoices.
Summarize Sales Order Invoices Based on Packing Slip Numbers

You can summarize sales order invoices based on packing slips to create sales order invoices that correspond to packing slip numbers. Each invoice can include line items from multiple sales orders, if they are included on the same packing slip. This enables you to invoice your customers for each delivery, regardless of when the items were ordered.
Example: Summarize Sales Orders Based on Packing Slips

You can use the Summary update for field in the sales order Posting invoice form to summarize the sales order invoices to follow the actual shipments, and reflect the packing slip that is created for the shipment.
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Assume that you have three sales orders and three packing slips, as shown in the following table. All packing slips have the same invoice account and currency code. Packing slip 1: June 15 Sales order 1, Line 1 Sales order 1, Line 2 Sales order 2, Line 1 Packing slip 2: June 17 Sales order 2, Line 2 Sales order 2, Line 3 Sales order 3, Line 1 Packing slip 3: June 19 Sales order 3, Line 2 Sales order 3, Line 3 Sales order 1, Line 3
If you select Packing slip in the Summary update for field, the invoices are summarized as shown in the following table. Invoice 1: June 30 Sales order 1, Line 1 Sales order 1, Line 2 Sales order 2, Line 1 Invoice 2: June 30 Sales order 2, Line 2 Sales order 2, Line 3 Sales order 3, Line 1 Invoice 3: June 30 Sales order 3, Line 2 Sales order 3, Line 3 Sales order 1, Line 3
If you do not summarize the invoices (select None in the Summary update for field), the invoices are based on the sales order documents, as shown in the following table. Invoice 1: June 30 Sales order 1, Line 1 Sales order 1, Line 2 Sales order 1, Line 3 Invoice 2: June 30 Sales order 2, Line 1 Sales order 2, Line 2 Sales order 2, Line 3 Invoice 3: June 30 Sales order 3, Line 1 Sales order 3, Line 2 Sales order 3, Line 3
Procedure: Summarize Sales Order Invoices Based on Packing Slips

To summarize sales order invoices based on packing slips, follow these steps: 1. Click Accounts receivable > Periodic > Sales update > Invoice. 2. In the Quantity field, select Packing slip. 3. Click Select and modify the query, if necessary. For example, you might select a range of dates for the Ship date field. 4. Click OK to close the Sales update form. 5. Select the Posting check box. 6. Make selections in the Print options field group, as needed. 7. On the Other tab, in the Summary update for field, select Packing slip.
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8. Click Select packing slip. 9. In the Select packing slip form, review the list of packing slips in the upper pane Overview tab. By default, all posted packing slips for the sales orders are included on the invoices. If the invoices must not include some packing slips, clear the Include check box for those packing slips. 10. Click OK to close the Select packing slip form. 11. Click Arrange. The sales orders and lines are grouped by packing slip number. 12. Click the Lines tab. The packing slip number and ship date are displayed on this tab. They are also printed on the invoice if you print invoice documents. 13. Click OK. The sales order invoices are posted and printed.
Sales Order Financial Posting

Sales Order Financial Posting introduces the set up of General ledger accounts for the automatic ledger transactions generated for receipt and issues of inventory. You can specify whether the account must be used for a specific item, for an item group, or for all items.
Sales Order Posting Profile - Inventory Posting

On the Sales order tab of the Inventory posting form, the sales order posting profile is set up to determine how the system handles ledger posting when an inventory transaction is posted.
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Inventory management > Setup > Posting > Posting > Sales order tab.
FIGURE 8.12 INVENTORY POSTING FORM - SALES ORDER TAB
Microsoft Dynamics AX 2009 lets you set up general posting rules and miscellaneous charges for: All items All accounts All sales-tax codes
You can define primary posting in Accounts receivable > Setup > Parameters > Ledger and sales tax tab. Select whether the primary sales, consumption, or discount posting occurs for the item or customer.
Sales Order Posting Hierarchy

When you post an order, Microsoft Dynamics AX 2009 searches for an item in a hierarchy. In the Item code field, select: Table, Group, or All. Item code Table Description This is the highest level in the hierarchy. The posting in ledger only applies to a specific item number. For example, if you want to track all costs and revenue related to a single important item, you may specify a Table relation for inventory posting for this item.
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Item code Group
Description The posting in the ledger only applies to a particular item group, for example, to track the costs and revenue associated with an item group. This may be for item groups set up for raw materials, spare parts, or finished produced items. Each transaction is posted for all item numbers in the same account in the ledger. Use this when you do not have to differentiate between item and item group posting. The All setting also provides you with fall-back posting. If you do not specify an account at the Table or Group setting, then the account specified for the All setting is used.
All
The way inventory posting is set up depends on how you want inventory posting to be represented in your financial reporting.
NOTE: This table/group/all hierarchy is used throughout Microsoft Dynamics AX 2009 and lets you implement the exception management concept, for example, when you define one account for All items and a different account for some exceptional items. This reduces the setup and maintenance efforts in the system.
Sales Order Packing Slip Posting

When the packing slip is updated for an item, transactions based on the item's cost at the time that the packing slip is updated are generated in the Packing slip account and the Packing slip offset account. To post packing slip related transactions for an item, ensure that the Post physical inventory parameter is set up for the item's inventory model group. To verify this, follow these steps: 1. Click Inventory management > Item Details. 2. Click the General tab and then click the Inventory model group field. Right-click the field and select Go to the Main Table form. 3. On the Setup tab for the inventory model group, verify that the Post physical inventory parameter is selected. Additionally, ensure that the Post packing slip in ledger parameter is also selected. To do this: 1. Click Accounts receivable > Setup > Parameters. 2. Click the Updates tab. 3. In the Packing slip field group, verify that the parameter Post packing slip in ledger is selected.
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NOTE: Companies may decide to work with packing slip posting in the financial inventory because, in theory, the goods are out of their inventory as soon as they have the status Deducted. This means that you can obtain a more accurate picture of inventory value as you consider items that have been delivered out of your company and also orders for which you have invoiced. The same applies for purchase orders and receipts where received items are considered part of your financial inventory although they have not yet been fully financially updated.
NOTE:Items that use the Inventory model Standard cost will have the Post physical inventory parameter enabled by default.
Invoice Posting for Sales Orders

When a sales order is finally invoice updated: The two packing slip transactions are reversed. The cost value of the item is released from the Issue account, also known as the Inventory account, and the offset for the release is made to the Consumption (or Cost of goods sold) account.
For posting to occur when invoice updating a sales order for items, the Post financial inventory parameter must be selected in the item's inventory model.
NOTE: If the item is of the type Service, you do not want to post item consumption because you do not keep items in stock; they are not consumed financially or physically. Therefore, the inventory model group attached to the item must have the Post financial inventory and Post physical inventory parameters cleared.
In addition to the inventory posting, the sales revenue and customer summary accounts receive postings during invoice updating. The customer account is updated in the sub-ledger when the sale is posted, and you set up the posting profile for this in Accounts receivable > Setup > Posting profiles.
Commission Posting for Sales Orders

When a sales person creates a sales order and invoices it, he/she may be eligible for a sales commission depending on a company's policy. For example, a company may pay it's sales person a percentage of the value of the order that was sold. To post commissions, Commission and the Commission offset accounts must be set up on the Sales order tab of the Inventory posting profile. These accounts provide an overview of the ledger posting for commissions.
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When a sales order is invoice-updated, the commission on the posted amount is debited from the Commission account and credited to the Commission offset account.
Discounts Posting for Sales Orders

A Discount account is used for discount types that are specified on the order header, but not on the order line. The order types are as follows: Line discounts Multiline discounts Total discounts
If a Discount account is used, the item's inventory value is the price before discounts.
Posting Expected Revenue and Packing Slip Tax

Packing slip revenue and Packing slip revenue offset accounts are used to post expected revenue when updating packing slips. Transactions are reversed with an offset when the invoice is posted. These functions require activation of Parameters in the Sales order and Inventory model groups. This account is used if you realize revenue at the time of shipping (Packing slip update) instead of at the time of invoice update. The Packing slip tax account is used to post estimated tax, at the time of packing slip update, to the General ledger. Typically, at this point in the ordering cycle, taxes are only estimated and can be tracked in this special account until confirmed. This helps if there is significant tax to consider and where there may be a lengthy period between packing slip update and confirmation of the tax amount.
Example: Sales Order Posting

The figure, Sales Order Posting, shows a delivery scenario where the two parameters Post physical inventory and Post financial inventory are selected. First, credit the packing slip and debit the packing slip offset account, shown by the amounts suffixed by 1. When invoicing the order line, you reverse the packing slip transactions, as indicated by the amounts suffixed by 2, credit the issues from the inventory accounts, and debit the Cost of Goods account. Although this occurs, the Revenue account is credited and the Accounts receivable is debited.
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FIGURE 8.12 SALES ORDER POSTING
Multisite
Multisite covers features that incorporate functionality to cater for a company with multiple sites. The features offered in Multisite include: Multisite enabled create Purchase orders and create Direct delivery orders Supply overview form Site specific prices on sales order lines Split posting of sales orders based on site
Multisite-Enabled Create Purchase Order and Direct Delivery Features

In Microsoft Dynamics AX 2009, you can set up a preferred vendor for each coverage-planned inventory dimension for every item. Consider, for example, a sales order is created that has three sales order lines. The sales order lines are all created for the same item that has Vendor Y assigned as the preferred vendor.
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The three sales order lines each have a different site attached: Site A: On the item selected, the preferred vendor for Site A is Vendor A. Site B: On the item selected, the preferred vendor for Site B is Vendor B. Site C: No preferred vendor is specified for Site C.
When a customer is creating a purchase order directly from the sales order, the Create purchase order form opens with the following lines: First line with Site A has Vendor A assigned. Second line with Site B has Vendor B assigned. Third line with Site C has the items-preferred Vendor Y assigned, because no preferred vendor for Site C was specified.
NOTE: When a customer creates a direct delivery from the sales order, the functionality is the same as with the create purchase order feature.
Supply Overview Form

The purpose of the Supply overview form in Microsoft Dynamics AX 2009 is to provide an overview of the available supply-beyond the default supply optionand to enable the user to view and compare the alternatives for supplying items that the customer requires at the time he or she specified. Other locations include the following: Sites other than the one making the delivery Vendors that are not usually used Alternative ways of producing the item
To satisfy a customer's demand for an item, the item can frequently be sourced in many ways, for example: Creating a production order at the site from which the order will be shipped to the customer Using available items in inventory or on existing production orders or purchased orders Creating a new purchase order by transferring from other warehouses
For some items, all those options are available; for others, only a subset can be used.
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The Supply overview form is opened from the Inquiries button from sales order lines, in the Sales Orders form.
FIGURE 8.13 SUPPLY OVERVIEW FORM
Scenario 1: Supply Overview Form

When Susan, the Order Processor, is viewing the Supply overview form, she notices that there is a quantity of an item on stock at another site. She contacts Eduardo, the Planner on that site, to check whether she may use those items. Eduardo currently has a surplus of the item in question because a customer recently changed an order. Therefore, he agrees that Susan may use them. Susan creates a transfer order for the items from their current site to the site from where they will be shipped. Susan inserts the ship and receipt dates on the sales order line based on this arrangement.

Considering the situation in scenario 1, Susan, the Order Processor, can also select to change the site and warehouse for the sales order line. She can then ship the items directly from the site where they are in stock, if it is permitted according to the company's business processes.
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Susan, the Order Processor, may find in the Supply overview form that there is a vendor who can deliver the items quickly. After checking the agreement with that vendor, she sees that the vendor charges a greater price. After deciding if it is worth paying the greater price (for example, it may be an important customer), she creates a purchase order at the vendor in question for the items and inserts the ship and receipt dates on the sales order line based on this arrangement.
Site Specific Prices on Order Lines

On the sales order lines, the inventory dimensions site and warehouse are pulled from the sales order header when no mandatory site and/or warehouse are stated for the item. With site as an inventory dimension on the sales order lines, Microsoft Dynamics AX 2009 can be set up to use site specific prices. This means that the item's sales price can differ, depending on which site the item is shipped from. Example A customer needs 100 items by the end of next month. Because the customer is not in a hurry, he or she chooses to have the items sent from site B where the items are shipped by van. Therefore, the transport time is longer than at Site A, where the items are shipped by helicopter and therefore with a shorter transport time. These site specific sales prices are controlled from the Trade agreements, where a site can also be used as a price differentiator. Whether applying the site specific prices or not, users can set up Site on the Inventory dimensions > General tab where the two check boxes For purchase prices and For sales prices can be selected and cleared.
Split Posting of Sales and Purchase Order Documents Based on Site

With the multisite feature in Microsoft Dynamics AX 2009, you can split posting based on site to ensure that a picking process can be started for one site without starting the picking process for all other sites represented on the order.
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The setup parameters for splitting postings is specified in Accounts receivable > Setup > Parameters > Summary update.
FIGURE 8.14 ACCOUNTS RECEIVABLE PARAMETERS - SUMMARY UPDATE TAB
Under the Split based on site information field group on the Summary update tab, the following check boxes are listed: Confirmation Picking list Packing slip Invoice
The first four check boxes are inactive. This means that these cannot be changed. For Confirmation, the check box is cleared. This means that the posting documents will not be split for each site. For Picking list and Packing slip, the check boxes are selected, specifying that the posting documents for those two must always be split for each site. The Invoice check box is active and can be selected, depending on if the invoice must be posted for each site or for all sites.
NOTE: On the Summary tab of the Accounts receivable parameters, there is also the possibility to specify that split posting must be based on the delivery information.
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Moreover, with this feature it is now also possible to select multiple orders in the Sales order form or Purchase order form. Each has lines with different site dimensions specified. If, for example, multiple sales orders have been selected, you can click Posting > Picking list and the Post picking list form will display a picking list for as many sites represented on the order lines for all the sales orders selected.
Shipping Carrier Interface

Microsoft Dynamics AX customers use many shipping carriers to deliver their products to customers. The Shipment carrier interface provides integration to the shipping carrier's software to help eliminate manual entry and improve tracking visibility.
Integration with Shipping Carriers

Integration automatically moves information that is received from the shipping carriers, such as freight charges and tracking numbers, into Microsoft Dynamics AX 2009 sales orders and invoices. A user can perform the following tasks: Calculate freight charges and add them to invoices as miscellaneous charges. Facilitate a will-call request by using the Sales pickup form.
NOTE: A will-call is a situation where a customer buys an item ahead of time and then picks it up themselves. The Sales pickup form is used to handle this type of request.
Request and manage tracking numbers by generating them in the shipping carrier software and then copying them into Microsoft Dynamics AX 2009. Print labels with the carrier software by using address information from Microsoft Dynamics AX 2009.
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The shipping carrier interface is accessed through Inventory management > Setup > Shipping carrier > Carrier interface.
FIGURE 8.15 CARRIER INTERFACE FORM
Scenario: Shipping Carrier Interface

Sammy, the person responsible for shipping and receiving, posts a packing slip. The information on that packing slip is stored in a way that enables the carrier software to read it. Sammy uses the carrier software to pull the packing slip information from Microsoft Dynamics AX 2009, and then prints labels and requests a pickup from the selected carrier for the package. Arnie, the Accounts Receivable Administrator, invoices the sales order and Microsoft Dynamics AX 2009 updates the order with shipping charges and packing slip information before the invoice is created.
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Summary
Sales Orders and Sales Order Posting reviewed how to set up and use the basic sales order functionality and perform posting updates. Learning about sales orders and sales order posting helps you create basic sales orders in Microsoft Dynamics AX 2009. Additionally, the more advanced sales features help you to: Improve customer service levels by setting up the delivery date control system to calculate the earliest delivery date to customers. Create deliveries directly from vendors to customers, reducing delivery time and order administration. Use the Supply overview form for an overview of supply across sites. Improve the integration between Microsoft Dynamics AX 2009 and shipping carrier software.
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Test Your Knowledge

Test your knowledge with the following questions. 1. Which Activate order entry deadline combination do you select if you want order entry deadlines to apply to a specific site and all order groups? ( ) Site, Order group ( ) Site, All order groups ( ) All sites, All order groups ( ) All sites, Order group 2. A customer does not receive deliveries on the first Friday of every month. Where do you specify this so that a delivery is not scheduled for the customer on this day?
3. Your company uses many different modes of delivery. However, you want one specific mode of delivery to be inserted on all sales order lines on order line creation. How do you set this up in the Transport time system?
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4. What are the Sales order Packing slip revenue and Packing slip revenue offset accounts used for? What happens when the invoice is posted?
5. What is the financial impact on ledger posting of invoicing a Sales order?
6. Sales order posting is set up based on what hierarchy?
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2.
3.
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Solutions
Test Your Knowledge
1. Which Activate order entry deadline combination do you select if you want order entry deadlines to apply to a specific site and all order groups? ( ) Site, Order group () Site, All order groups ( ) All sites, All order groups ( ) All sites, Order group 2. A customer does not receive deliveries on the first Friday of every month. Where do you specify this so that a delivery is not scheduled for the customer on this day? MODEL ANSWER - In the Customers form, in the Delivery field group, under Receipt calendar. 3. Your company uses many different modes of delivery. However, you want one specific mode of delivery to be inserted on all sales order lines on order line creation. How do you set this up in the Transport time system? MODEL ANSWER - Selecting the Default check box for the mode of delivery in Inventory management > Setup > Distribution > Transport for the particular warehouse/address relation, or with Transfer orders warehouse/warehouse relation. 4. What are the Sales order Packing slip revenue and Packing slip revenue offset accounts used for? What happens when the invoice is posted? MODEL ANSWER - Posting expected revenue when updating packing slips. When the invoice is posted, transactions are reversed with an offset.
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5. What is the financial impact on ledger posting of invoicing a Sales order? MODEL ANSWER - The two packing slip transactions are reversed. The cost of the item(s) is released from the Inventory account. The offset for the cost of the item is made to the Consumption account. 6. Sales order posting is set up based on what hierarchy? MODEL ANSWER - Item - Table Item group - Group All items All
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Chapter 09: Sales Order Picking
CHAPTER 9: SALES ORDER PICKING

Objectives
The objectives are: Explain how the Inventory dimension group, Inventory model group, and Accounts receivable parameters affect the Item registration setup Set up and process an automatic registration of a pick Set up and process a manual one-step pick Register serial and batch numbers during the picking process Work with the transaction in the Pick form to edit, reverse, and split picks Set up the Release sales order picking form and allocate on hand inventory for sales order picking
Introduction
Sales Order Picking introduces the features that support item picking registration. It will cover how to perform the following tasks in Microsoft Dynamics AX 2009: Set up the sales picking process Process a sales pick Pick item dimensions including serial numbers and batch numbers
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Item Pick Registration Setup

Users can set up Microsoft Dynamics AX 2009 to help them record the item number, configuration, quantity, and dimensions before recording a physical update. Settings that effect how you perform the pick process are: Dimension group: Set up item and storage dimensions requirements for picking. Inventory model group: Control the registration requirements. Accounts receivable setup parameters: Set up transactions for automatic picking.
Inventory Dimension Group

An item's Inventory dimension group determines which storage dimensions can and must be recorded in the pick process. You open the Inventory dimensions form by clicking Inventory management > Setup > Dimensions > Dimension groups.
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In the figure, Inventory Dimensions Form, the inventory dimensions warehouse, serial number, and batch number are enabled dimensions. This means they must be specified for items assigned to this dimension group.
FIGURE 9.1 INVENTORY DIMENSIONS FORM
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The Inventory model group setup controls the item's picking requirements. The Inventory model group form is located at Inventory management > Setup > Inventory > Inventory model groups.
FIGURE 9.2 INVENTORY MODEL GROUPS FORM - SETUP TAB
Set up and maintain the settings for the Inventory model group on the Setup tab. The fields in the Physical update field group determine the workflow used when you send or receive items. With these fields, you can set rules around how an order is handled, both for receiving and shipping.
Inventory Model Group - Parameters

When shipping an item, you can use three parameters in the Setup tab of the Inventory model group form: Picking requirements: This parameter determines whether the item's inventory records must have the status Picked before a packing slip can be physically updated or before an inventory journal can be posted. When this is selected, the picking list registration must be manually posted. Deduction requirements: This parameter determines that you must physically update item deductions before they can be financially updated.
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Consolidated picking method: This parameter determines that you manage item picking through an Output order with the pick of multiple orders, and by using picking areas and shipment functionality. Therefore, ensure that this check box is cleared when you register a pick from the sales order line.
NOTE: You can pick items with specific dimension values even though the Picking requirements check box is cleared.
Accounts Receivable Setup

In the Accounts receivable parameters, transactions can be set up for automatic picking. This Parameters form is located at Accounts receivable > Setup > Parameters.
FIGURE 9.3 ACCOUNTS RECEIVABLE PARAMETERS FORM - UPDATES TAB
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On the Updates tab under the Picking list pane, you can select three parameters, as shown in the following table. Check box Automatic reduction, picking list Description Select this to reduce the quantity on the picking list to match the quantity available- if the full quantity is not available-in stock. In this manner, a picking list is not made for items not in stock. Notice that for this to work, you must make the picking list from the order header by clicking the Posting button and not directly from the line. Also notice that if the Complete check box on the Sales order line on the General tab is selected, an error will appear because it is then required that you complete the full order and not only a part of it. Select Completed to have the system automatically set the inventory transactions to Picked when you update the picking list. You can select Completed, for example, when the items sold are always in stock and therefore a response to the picking process is not needed. Select Activated if you want to update the picking list manually. Use the default language code from your own company information when printing the picking list. If this check box is not selected, the language on the picking list is the customer's language. However, if there is no translation of the customer's language, the default language is used.
Picking route status
Use default language
NOTE: If both Picking requirements is selected in the inventory model group and Picking route status is set to Completed in the Accounts receivable parameters, the Accounts receivable parameters overrule the settings in the Inventory model group. This means that the picking list registration is performed automatically.
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Picking Processes
You can set up a picking process in three ways, as shown in the table. Picking process Automatic Description Use when a response to the picking list is not necessary, for example, when the items sold are always in stock. Use when the dimension values are known at the time of picking. Use when you want to assign a picking task and then peform a physical pick.
Manual - One Step Process Manual - Two Step Process
Automatic Registration of a Pick

You can set up a pick to be automatically registered by selecting Completed in the Picking route status parameter in the Account receivable parameters.
FIGURE 9.4 PICKING ROUTE STATUS FIELD = COMPLETED
Automatic registration of a pick means that a sales order can continue to the Packing slip update after you post the Picking list because the Picking list registration step is automatically completed.
Procedure - Automatic Picking Registration

To enable items for automatic picking in the Accounts receivable parameters, follow these steps. 1. Open Accounts receivable > Setup > Parameters and then click the Updates tab. 2. Select Completed in the Picking route status field and then close the Accounts receivable parameters form. In a sales order, the Picking list must be posted as usual. To verify that the status of the sales order is picked after you post the Picking list, click the sales order header and then click Posting > Picking list registration or from the Transactions form, in the Issue field, notice that the status is Picked. With an issue status of Picked, the order is ready to continue to packing list and invoice update.
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NOTE: You can only perform automatic picking if all required Inventory dimensions are known.
Manual Registration of a Pick

Items that require a manual documentation of dimension values, such as serial or batch numbers, follow a one-step or two-step picking process. The manual one-step process: Use this process when you know the dimension values at the time of picking and can specified them during the pick process. The process involves registering the actual dimension values when you post the pick. The manual two-step process: This process enables you to assign a picking task and then perform the physical pick. The process involves: o o Posting and printing a picking list of items to be picked in the warehouse Registering the actual dimension values and posting the pick
NOTE: The manual two-step picking process will not be covered in this course. For more details on the two-step picking process, refer to the Microsoft Dynamics AX 2009 Warehouse Management course.
Manual One-Step Process

With the manual one-step process, you do not have to print the pick document because picking is completed directly from the sales order line. To control this process, select the Picking requirements check box in the Inventory model group. Scenario: The inventory manager at Contoso Entertainment Systems has noticed that for certain items, there is rarely enough inventory available to fulfill the orders. Therefore, incorrect items are picked or incomplete orders are marked as picked and shipped to the customer. To resolve this problem, the inventory manager has started a one-step picking process for these items. By using this process, the accuracy of the picking process has improved as additional confirmations must be entered into the system before the order can be marked as picked.
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Procedure: Manual One-Step Process
To pick directly from the sales order line and prepare the order line for packing and invoice update, follow these steps. 1. Select the sales order line and then click the Inventory > Pick. The Pick form opens with the window split into two panes: Transactions and Pick now. 2. In the Pick form, use one of the following methods to pick the items for the sales order: o In the Pick now pane, create a new line. o Create the line automatically by selecting the Auto-create check box in the Transactions pane. Microsoft Dynamics AX 2009 then transfers the default dimensions from the Transactions pane to the Pick now pane.
NOTE: If the required inventory dimensions are not selected in the Pick now pane, you cannot post the pick. However, if Blank issue allowed is enabled in the item's Dimension group, you can post the pick without the dimension values.
3. Select the correct inventory dimensions in the Pick now pane before posting the pick. Use the On-hand tab to view which warehouse and which pallet the item is stored or which serial number is available for the item you want to pick. Any default values can be changed. 4. Click the Post all to update the pick and close the Pick form. 5. To verify that the status of the order is now picked, click the sales order line, and then click Inventory > Transactions. In the Issue field, the status of the item is now Picked.
Item Pick Registration of Serialized and Batch Inventory

Serial and batch numbers are inventory storage dimensions and can only be allocated to items, where the Inventory dimension group allows for it. When the dimension values Serial number and Batch number are enabled, you must specify them when picking, unless Blank issue allowed is enabled for the storage dimension. Scenario: Contoso Entertainment Systems best selling product is a DLP Projector. Because Contoso Entertainment Systems wants to track these items and their sales and maintenance history, they assign each DLP Projector with a serial number at the time that it is picked. The serial number includes the date and location of the pick, and in this manner, the company can collect information about what happens with the DLP Projectors after they leave the warehouses.
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Batch Registration
The Demonstration: Batch Registration will show how the registration of batch numbers is handled on the sales order line by using the manual one-step process.
Demonstration: Batch Registration

In this demonstration, you will create a sales order for an item batch and assign the same batch number to all the items in the picking process. To assign batch numbers to items during the one-step picking process, follow these steps. 1. Create a sales order for ten items of 1706 to customer 1203. 2. Click Inventory > Pick. The Pick form opens, referencing the sales order, the Transactions, and the Pick now pane. 3. In the Transactions pane, select the batch number for all ten items. 4. Select the Auto-create check box, and the pick line is automatically created in the Pick now pane. 5. Click the Post all button to post the pick. 6. Confirm that the quantity is 5 and the status is Picked in the Issue status field in the Transactions pane. 7. Close the Pick form and the sales order is ready to be packing slip and invoice updated.
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Lab 9.1 - Item Picking Registration of Serialized Inventory

Contoso Entertainment Systems - Company CEU Scenario Because of previous defects on item number 150110, LCD Television Batch/Serial, Contoso Entertainment Systems wants to have maximum traceability when these items are sold. The shipping and receiving clerk at the Contoso Entertainment Systems must ensure that the correct items are picked and sold from the inventory. You have been asked to create and pick a sales order for customer 1202, Owl Wholesales, for five pieces of item number 150110. The sales order must be delivered from Site 2, Warehouse 21. The items must be picked from the same batch but with unique serial numbers.
Prerequisites
1. Create a new item number 150110 LCD Television - Batch/Serial, by using the following parameters: Parameter Item group Inventory model group Dimension group Batch number group Serial number group Specification Television FRP_PICK N-WBS Bat_Auto SNG
2. Create a purchase order for 15 pieces of item number 150110, to Site 2, Warehouse 21 from vendor 1001, Earth Televisions. 3. Register the item arrival and invoice the Purchase order. Serial and batch numbers will automatically be assigned at registration.
Challenge Yourself!
1. Create a sales order as described in the scenario. 2. Use a manual one-step process to pick and register the items on the sales order line. 3. During the picking process, reserve the items from one batch, each with unique serial numbers. 4. After you complete the pick, review the transactions to ensure that the items are all picked and assigned both batch and serial numbers.
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Need a Little Help?
1. Ensure that Picking requirements are checked in the Inventory model group. 2. Ensure that Activated is selected in the Picking route status field in the Accounts receivable parameters. 3. Click Inventory > Pick to start the one-step picking process. 4. In the Pick form, click Reservation to specify the exact serial and batch numbers for the sales order.
Step by Step
First remember to create the prerequisites for the lab, which are: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. Create Item number 150110. Create a purchase order for the new item, register it, and invoice it. Click Accounts receivable > Sales Order Details. Press CTRL+N to create a new sales order. Select Customer number 1202, Owl Wholesales. Click Yes in answer to the prompt about how to transfer customer information. Click OK. Select 150110 in the Item number field. Select 2 in the Site field. Select 21 in the Warehouse field. TAB to the Quantity field and type 5. On the sales order line, click Inventory > Pick. Click Reservation (if you do not see the Batch number field, use Inventory > Dimensions display to view it on the form. In one of the batch number lines, type 5 in the Reservation field. Close the Reservation form. Select the Auto-create check box for each of the lines in the Pick form and then click Post all. The order is now ready for packing slip and invoice update. View the transactions by clicking Inventory > Transactions.
15.
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Edit, Reverse, and Split a Pick

During the picking process, you can work with a transaction in the Pick form.
FIGURE 9.5 PICK FORM
To enable the attribution of various Inventory dimension values, a picked line can be: Reversed Edited Split
To update a pick on a sales line, you must first reverse the transaction.
NOTE: To reverse a pick, the Issue status of the sales line must not be Delivered. As soon as a Packing slip has been posted, the transaction is closed and it cannot be reversed.
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Confirm Inventory Storage Dimensions after Pick Registration
At Contoso Entertainment Systems, some inventory storage dimensions are not confirmed until after pick registration. The active inventory dimensions at Contoso Entertainment Systems are as follows: Serial number Batch number Warehouse Site
For some items, because there is so much stock on hand within the warehouses, the storage dimensions of the items that will be picked are not known until the pick has been completed. Fortunately, Microsoft Dynamics AX 2009 supports editing, reversing, and splitting of picks. This enables the company to make the changes to the storage dimensions after picking, based on the results of the pick.
Procedure: Unpick and Edit

To unpick and edit a transaction, follow these steps: 1. On the sales order line, click Inventory > Pick. 2. In the Pick form, there is a line in the Transactions pane with an Issue status of Picked. When you select the Auto-create check box, a line is created in the Pick now pane with a negative quantity. This means that five items are unpicked. 3. To post the reverse pick, click Post all and the Issue status in the Transactions pane is reversed back to On order.
HINT: You can update the quantity in the Pick now field if, for example, only some items must be unpicked. If you change the quantity and post it, this creates two transactions in the Transactions pane - one with the status of Picked, which contains the items that were not unpicked, and one with the status of On order. This is the transaction that must be picked again with new dimension values.
4. The items can now be registered again with the same or new dimension values if they must be edited. 5. In this scenario, you will register the items by using a different warehouse that can be edited either on the sales order line or in the Pick form. 6. To register the items again, select the Auto-create check box and in the Pick now pane, specify the new dimensions, and then click Post all.
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Split a Pick
Use the split function when items on one sales order line must be divided, for example, when: you are picking both serial and batch numbers the lines must be picked from several warehouses
Procedure: Split a Pick

Consider an example of a split where you create a sales order of 20 items and ten of the items are available to be picked from one batch and the remaining items must be picked from a different batch. To split a transaction, follow these steps. 1. On the sales order line, click Inventory > Pick. 2. Click the Split button on the Transactions pane and you can split or divide an open transaction into several transactions. 3. A prompt box appears, where you specify the number to move to a new transaction. Enter the quantity 10 for the amount of items that you want to split in the Split quantity field and then click OK. In the Transactions pane, there are now two transactions that can be assigned different batch numbers. 4. For each transaction, select a batch number in the Batch number field and then click the Auto-create button to make the pick. 5. When both transactions are in the Pick now pane, click the Post all button and the Issue status for both lines changes to Picked. The sales order is now ready for picking list and invoice update. To view the transactions for each line, click Inventory > Transactions on the sales order line.
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Lab 9.2 - Edit, Reverse, and Split a Pick

Contoso Entertainment Systems - Company CEU Scenario Sammy, the shipping and receiving clerk at Contoso Entertainment Systems, was asked to create a sales order for customer 2022, Triangle Headquarters Training Center, for four pieces of item number 1706. All the items must be assigned the same batch number: 000004. After the pick is registered, he is informed that the real batch number is 000005; therefore, he must edit the pick. After Sammy made the batch number change, he learned that the customer wants to split the order into two batches with two items each. One batch must have the batch number 000004 and the other batch number 000005. When this edit is completed, Sammy decides to examine the transactions to ensure that the changes have been made correctly.
Challenge Yourself!
Create a sales order for item 1706 as described in the scenario. Reverse and edit the batch number from 000004 to 000005. Verify the edit. Reverse the pick. Split the pick in two batches with the respective batch numbers: 000004 and 000005. Verify the changes.
Need a Little Help?

1. Create sales orders in Accounts receivable > Sales Order Details. 2. Edit and reverse inventory dimensions from the Pick form, which is located at Inventory > Pick. 3. The Auto-create check box on the Pick form will reverse a pick in addition to support a split. 4. Ensure that you reverse the pick before making edits. 5. Add or edit the serial numbers after you have registered the picking list.
Step by Step
1. Click Accounts receivable > Sales Order Details. 2. In the advanced view, press CTRL+N to create a new sales order header. 3. In the Create sales order form, select customer account 2022.
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4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. Click Yes to the Transfer customer information dialog box. Click OK in the Create sales order form. Select 1706 in the Item number field. Type 4 in the Quantity field. Press CTRL+S to save the sales order. Click Inventory > Pick to register the pick. Select the Batch number 000004 in the Batch number field in the Transactions pane. Select the Auto-create check box. Click the Post all button. Close the Pick form. On the Sales order line, click Inventory > Pick to edit the pick. Select the Auto-create check box and then click the Post all button, to reverse the pick. In the Transactions pane, change the batch number from 000004 to 000005 and select the Auto-create check box. Click the Post all button and close the Pick form. Click Inventory > Transactions to verify that the batch number for the sales order is now 000005. Click Inventory > Pick to open the Pick form. Select the Auto-create check box and then click the Post all button, to reverse the pick. In the Transactions pane, click Split to split the order into two batches. In the Split transaction form, specify -2 in the Split quantity field and then click OK. Select batch number 000004 for one transaction and batch number 000005 for the other transaction. Select the Auto-create check box for both lines. Click the Post all button. Close the Pick form. Click Inventory > Transactions to verify the changes you made to the sales order.
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Release Sales Order Picking

The Release sales order picking functionality helps warehouse employees gain an overview of the sales orders that are to be released for picking, based on actual availability of items and considering customer service priority. By using this platform for the picking process, you are ensured that only picking lists for items in stock are created. There are two forms to make the picking process easier: one for sales orders and the other for transfer orders.
Customer Classification Groups

Customer classification groups enable you to flag customers according to service priority. If back orders exist for sales order lines, one of the criteria that you can use to determine which sales orders must have quantity available allocated to them is the customer classification group that you attach to the customer for the line.
FIGURE 9.6 CUSTOMER CLASSIFICATION GROUP FORM
Example: The warehouse manager must be able to determine which customers back orders must have on hand inventory allocated to them first. To create a priority ranking, the warehouse manager attaches a customer classification group to the customers. The warehouse manager creates premium and standard classifications, classifications 1 and 2 respectively, that are then attached to customers.
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Later, the warehouse manager must allocate available inventory to two sales order lines with the same inventory dimensions specified for them on the same shipping date. One sales order line is for a customer whose classification group is 1, and one line is for a customer whose classification group is 2. Because classification 1 customers take priority, all the quantity that is available is allocated to the classification 1 customer's line.
Procedure: Create a Customer Classification Group

To create customer classification groups, follow these steps. 1. Click Accounts receivable > Setup > Customer classification groups. 2. Press CTRL + N to create a new customer classification group. 3. Complete the Customer classification group field, for example, 1. 4. Complete the Description field, for example, Highest priority. 5. Close the Customer classification group form. 6. Click Accounts receivable > Customer Details > General tab. 7. Select a customer classification group in the Customer classification group field. When you have attached the customer classification group to the customer, you can see it on any sales order line that appears in the Release sales order picking form.
Set Up the Release Sales Order Picking Form

The fundamental prerequisite for viewing and processing sales order lines in the Release sales order picking form is that there is some quantity available against which to, at least partly, fulfill the sales order line. If this criterion is met, you can define which sales order lines to view in the form by specifying criteria in the Select query that appears when you open the Release sales order picking form. Additionally, by using the Deduct released for picking option, you can eliminate any lines for picking for which there is no available quantity to allocate.
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Select Criteria for Displaying Sales Order Lines
When you open the Release sales order picking by clicking Inventory management > Periodic > Release sales order picking, you define which data to display in the form by entering selection criteria in the Select query.
FIGURE 9.7 RELEASE ORDER PICKING FORM - SELECT QUERY
Use the selection criteria to, for example: Only show the release sales order lines that are going to be shipped before next week. Order Lines.Ship Date = (LessThanDate(7)) Sort sales order lines by the top customer classification group for the relevant customer so that you can prioritize allocation of limited on hand orders to back orders for high priority customers.
Deduct Released for Picking

The Deduct released for picking feature addresses the problem that some companies experience when they create picking lists without reserving items for the picking list. If you picking list update a sales order line without reserving the items on the line, it may appear that these items are available for use in another order, even though the items have been designated for the original order by their inclusion in the picking list for the original order. By selecting the Deduct released for picking option you make sure that any order lines that have been picking list updated, but not reserved, are eliminated from the Release sales order picking form. Therefore, Deduct released for picking enables order takers to obtain a clearer picture of whether they can allocate on hand items for a sales order line.
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You may also be in the situation where a quantity of available items-but not the whole quantity- is picking list updated without being reserved at the same time. In this situation you can see the amount that has been picking list updated but not reserved in the Picking list not reserved field in the On-hand pane of the form.
Example: Deduct Released for Picking

A sales order line for sales order number 00300_036 exists for 500 pieces of item number 1508 from warehouse 1. There are 1,000 pieces of item number 1508 available at warehouse 2. The warehouse manager opens the Release sales order picking form and notices that four other sales order lines exist for item number 1508, with the same inventory dimensions. The Deduct released for picking parameter is selected. The warehouse manager leaves the Release sales order picking form open to allocate on hand items to sales order lines after the lunch break. During that morning, two of the other sales order lines are picking list updated, without the items being reserved, because they are marked with a better customer classification group and are therefore a higher picking priority than the sales order line in sales order number 00300_036. The warehouse manager returns and updates the Release sales order picking form by clicking Recalculate. All the sales order lines disappear because there are now no available items to fill the order. This is because the initial 1,000 pieces have been picking list updated for the two other sales order lines and are, according to the criteria set by the parameter, unavailable for allocation elsewhere.
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Viewing Information in the Release Sales Order Picking Form
When you have selected the sales order lines that you want viewed in the Release sales order picking form, use the information in the form to decide about the on hand items to be allocated for picking.
FIGURE 9.8 RELEASE SALES ORDER PICKING FORM
Quantity Field Group

Use the Quantity field group to obtain a detailed breakdown of the quantity status for the current sales order line. View information for the quantity of the order line that has already been picked or reserved and if reservations exist on ordered, but not yet received receipts. The Picking list reserved and Picking list not reserved fields are especially beneficial to the warehouse manager who is trying to allocate on hand inventory: Picking list reserved - Shows quantities of the item for the current sales order line that have been updated with a picking list and reserved. The reservation will prevent these items from being allocated for another sales order.
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Picking list not reserved - Shows quantities for the sales order line that have had a picking list printed for them but that have not been reserved in the process. Therefore, although the items are still available for allocation elsewhere, they have in fact been allocated for this order's pick. By considering this field when allocating inventory to sales orders, you can ensure that you do not allocate on hand items that have been picking list updated, but not reserved, for another sales order.
On-hand Field Group

The On-hand field group resembles the Quantity field group except it displays values for all on hand items throughout the system. The field group shows different quantities of on hand items available for each inventory dimension and their status with regard to physical inventory, physical reservation, physical availability, the number of picking list non-reserved items, and other categories of availability.
Allocate On Hand Inventory for Sales Order Lines

When you have defined exactly which sales order lines you want to view in the Release sales order picking form, you are ready to start allocating on hand inventory to the order lines. Allocate on hand inventory for sales order lines individually by entering a quantity in the Activate now field on the sales order line or by selecting one of the activation methods from the Activation button.
Check Boxes in Sales Line Tab

The check boxes in the Sales line tab of the Release sales order picking form are system selected and provide information about to what extent orders can be fulfilled and how to fulfill them. The following table describes the check boxes. Check box All orders can be delivered Description Indicates whether all orders with the same item number and inventory dimensions (storage location) can be delivered by using the current on hand inventory. Select if you have to decide about how on hand items must be allocated to the sales order. For example, if you have to allocate on hand items to two sales order lines where there is insufficient inventory to fulfill both, the check box is selected and the warehouse manager must make an allocation decision.
Requires allocation
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Check box Production order exists
Description Select if there is a production order line that needs the same item with the same inventory dimension with an estimated date before or equal to the shipment date entered in the Select dialog box. Select if there is a transfer order line that needs the same item with the same inventory dimension with an estimated date before or equal to the shipment date entered in the Select dialog box. The percent is calculated on the number of sales order lines that can be fulfilled for a sales order. For example, if two out of the three sales order lines for a sales order can be filled, then the Delivery Pct possible is 67 percent.
Transfer order exists
Delivery Pct possible
Procedure: Activate Quantities from the Sales Order Line

If you activate the quantity on the line, you can allocate a part of the quantity if, for example on hand quantities must be allocated to another priority sales order line or the whole quantity. To allocate on hand inventory to a sales order line, follow these steps: 1. Click Inventory management > Periodic > Release sales order picking. 2. Select the sales order line for which you want to allocate on hand inventory. 3. Enter a value in the Activate now field. A reservation is automatically created, although you can delete this reservation. 4. Click Recalculate. 5. Click Release for pick to picking list update the items. Items that were reserved at the time of activation are updated in the Picking list reserved field, and for lines where the reservation was deleted, they are updated in the Picking list not reserved field.
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Activation Methods
By selecting one of the allocation methods from the Activation button, you can allocate on hand inventory to all sales orders that fulfill the activation criteria. The following table describes the Allocation methods. Activation option Clear activate now All orders where entire order can be delivered Description When you select this option, all Activate now entries on all the records in the form will be reset. When you select this option, the Activate now field is filled in with the value from Activate remainder field for all sales order lines that have 100 percent in the Delivery percent field. EXAMPLE: An order has three lines, and all lines can be fulfilled by the current on hand inventory for the selected inventory dimension for the item. Therefore, in the Delivery Pct. field, the value 100 percent is displayed. If you perform an activation by using the All orders, with the entire order can be delivered option, this order will have its order lines activated with the appropriate quantity. All orders that have the status reserved physical When you select this option, the Activation field is filled with the value from the Reserved physical field minus the value from the Picking list reserved field. When you select this option, the Activation field is filled with the value from Activate remainder on all sales order lines that have the All orders can be delivered check box selected. EXAMPLE: If you select the All orders that do not need manual allocation option, on hand inventory is allocated to all sales order lines where a flag appears for All orders can be delivered. When you have finished allocating on hand inventory, you can picking list update the sales order line. The sales order line remains in the view until you have ordered the pick.
All orders that do not require manual allocation
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Deliver Remainder
Use the Deliver remainder function to close back orders if, for example, you have insufficient on hand quantity to fill the sales order but have established that it is acceptable to the customer to whom you make an under delivery. The function works in a similar manner to how it does in the sales order form.
FIGURE 9.9 UPDATE REMAINING QUANTITY FORM
To open the Update remaining quantity form, click Functions > Deliver remainder.
Summary
Sales order picking is a multi-step process that enables users to: Set up item picking registration methods Register a pick, either manually or automatically Edit, reverse, or split a pick Perform release sales order picking
Sales order picking provides a business with an efficient way to ensure the tracking of items that are sent to their customers. Release Sales Order Picking provided an overview of the sales orders to be released for picking, based on the actual availability of items. Release sales order picking enables a business to consider customer service priority and allocating quantities of on-hand inventory for picking .
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2.
3.
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Chapter 10: Customer Returns
CHAPTER 10: CUSTOMER RETURNS

Objectives
The objectives are: Set up reason codes, disposition codes, and miscellaneous charges for customer returns Work with disposition actions Create a Return order and navigate the Return order form Process the arrival of a Return order Handle returned items in quarantine inspection Create a Replacement order Explore reports and statistics to use for Customer returns
Introduction
A customer may return an item to a company for various reasons. For example, it may be defect or not fulfill the customer's expectations. The return process begins when you receive a request from a customer to return an item and create a Return order in Microsoft Dynamics AX 2009. Additionally, reports can be printed to determine: The volume of returns for each item or customer The time that is spent on handling customer returns How well the return process is managed
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Scenarios: Customer Returns

The Customer Returns scenarios in this lesson show how to create, confirm the arrival of, and inspect the returned items. The final two scenarios show the final procedures of processing the Sales order and updating the Return order.
Scenario: Create a Return Order

A customer contacts Lisa in customer service. Apparently, there are problems with the latest order that he or she received. Specifically, some delivered items are defect, and one item did not meet the customer's needs. Lisa finds the reference number of the order and creates new Return orders for the customer. By using the reference number, Lisa finds the Sales order and views the ordered items. The customer explains the following: Item A was damaged during shipment Item B does not function Item C is not intact Item D is unwanted. The color was not what the customer was expecting
Lisa validates and selects the various items one by one from the Sales order she found. In support of the later inspection or troubleshooting process, Lisa enters the expected return quantity, Estimated Time of Arrival (ETA) for the items, a reason code, and any additional information that the customer provided.
NOTE: The Reason code is a Return order header property. This means that, in this example, that Lisa is creating four different Return orders.
Lisa informs the customer of the deadline for returning the items and the address of the warehouse. Finally, she sends the Return order document in paper or electronic form to the customer. The Return order document contains the Return Materials Authorization (RMA) number which authorizes the customer to return goods to the company.
Scenario: Receive the Returned Items

Ten days pass, and Sammy, who is responsible for shipping and receiving, receives the returned items at the return warehouse. Sammy views the accompanying Return order documents, evaluates the returned items, and counts and checks them against the Return orders. Sammy will open the Arrival overview form, find the arrival among the other returns, and create a new Item arrival journal. Because of the imposed requirement for inspection, Sammy will specify that the item must be inspected for each journal line. He then posts the arrival journal.
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NOTE: Inspection means that the items will pass through Quarantine orders and to the Quarantine warehouse.
Had the company policy permitted Sammy to make decisions of how to dispose of the returned items, he may have applied a disposition code to the journal line instead of sending the item(s) to inspection.
Scenario: Confirm the Arrival of Returned Items

Lisa, in customer service, is notified that the returned items have arrived. She mails the customer a confirmation that the returned items have arrived at the return warehouse and additional investigations will begin.
Scenario: Inspect the Returned Items in Quarantine

Ricardo, the quality controller, has received four Quarantine orders and the returned items, and now starts to inspect them. He examines the described symptoms and descriptions to ensure that those are correct. When the inspection is complete, Ricardo updates the Quarantine orders with the following information: Item A is not functioning, it receives disposition code 61 -Scrap item, credit customer with disposition action: Scrap. The customer will be credited and the item will be scrapped. Item B has been delivered with the wrong antenna. It receives disposition code 31 - Replace item, credit customer with disposition action: Replace and credit. Ricardo or Lisa, the customer service representative, will specify a replacement item. The customer will be credited, and replacement item will be entered on a new Sales order. Item C must be repaired. It receives disposition code 51 with disposition action: Return to customer. The item will be repaired and eventually returned to the customer. The customer will be invoiced for charges, and parts according to company policy. Item D is working fine, and is put back into inventory; it receives disposition code 11 - Put item back in to inventory, credit customer with disposition action: Credit. The customer will be credited and item will be put into inventory again.
Ricardo cannot end the Quarantine order for the item C, until it is repaired. The remaining three Quarantine orders can be ended by Ricardo. Ending the orders will transfer the information about disposition codes back to the Return order lines, making them available for additional processing by Susan, the order processor.
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Scenario: Process the Return Order
Susan, the order processor, packing slip updates the Return orders to receive the returned items into inventory, and to create Replacement orders if required.
Scenario: Update the Return Order

Item C has been through inspection, and is repaired and ready to be shipped back to the customer. Ricardo, the quality controller, can end the Quarantine order. This enables Susan, the order processor, to send the repaired item back to the customer and close the Return order.
Scenario: Invoice a Return Order

Susan creates the credit notes and invoices for the Return orders. At this point, Susan can add charges. The invoice for a Return order can only be performed from the Sales order form and not the Return order form.
Set Up Customer Returns

Returns can be categorized according to return reasons or methods of disposition, and specific charges can be combined with the various return categories. Set Up Customer Returns discusses how to set up Microsoft Dynamics AX 2009 to work with customer returns.
Return Reason Codes

Applying reason codes on returns can help simplify the analysis of return patterns. The reason codes are set up is to determine why a customer wants to return item(s). Some companies may have many reason codes, and will group the reason codes for better overview and for accumulated reporting.
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The figure, Reason codes form, is an example of how to set up the return reason codes in Microsoft Dynamics AX 2009.
FIGURE 10.1 REASON CODES FORM
Procedure: Set Up Return Reason Code Groups

To set up return reason code groups, follow these steps: 1. Open the Return reason code groups form from Accounts receivable > Setup > Sales order > Returns > Return reason code groups. 2. On the Overview tab, specify the name of the return reason code group and enter a description. 3. Close the form.
Procedure: Create a Return Reason Code

To create a return reason code, follow these steps: 1. The Return reason code form can be opened from Accounts receivable > Setup > Sales order > Returns > Return reason code or from the Return reason code groups form, by clicking the Return reason codes button. 2. Enter the name of the reason code and a description. 3. From the Return reason code group field, select the return reason code group to link to the reason code. 4. Close the form. The reason codes are applied in the Return order header.
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Disposition Codes
Disposition codes are also a part of the customer returns setup; they determine what will happen to the returned items from both a physical and a financial perspective. The available options are defined by the disposition actions. As part of the item arrival and inspection, a disposition code will be assigned to the returned goods. In addition to determining how to dispose of the returned goods, disposition codes can cause miscellaneous charges to be applied to the return line and may additionally be used to group returns for statistical analysis. The figure, Disposition codes form, is an example of how to set up a disposition code in Microsoft Dynamics AX 2009.
FIGURE 10.2 DISPOSITION CODES FORM
A disposition code can be applied when: Creating the Return order Registering item arrival Ending a Quarantine order
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Disposition Actions
Microsoft Dynamics AX 2009 has six predefined disposition actions that define the combination of the following: The physical handling of the returned item The financial effect of the return transaction If a replacement item must be sent to the customer
The Disposition actions and definitions are provided in the table. Disposition action Credit Credit only Definition Return the item to inventory, then credit the customer. Credit the customer and do not return the item. Or, if the customer scraps the item, credit the customer. The Credit only disposition action is available from the Return order form only, as part of when you create the Return order. Scrap the item, then credit the customer. Scrap the item, create a replacement order, then credit the customer. Return the item to inventory, create a replacement order, then credit the customer. Reject the returned item, and return it to the customer.
Scrap Replace and scrap Replace and credit Return to customer
Procedure: Create a Disposition Code

To create a disposition code, follow these steps: 1. Open the Disposition codes form from Accounts receivable > Setup > Sales order > Returns > Disposition codes. 2. Enter the name for the disposition code and the description. 3. In the Action field, select an action for the disposition code. 4. Close the Disposition codes form.
Miscellaneous Charges
Many companies want customers to pay either a return fee or special return handling charges. You can set up miscellaneous charges as a standard fee based on a return reason code or disposition code, or you can add them manually to the order header or lines.
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Example of Fees Here are examples of the setup of a reason code and disposition code for miscellaneous charges. Reason code Customer return/Unwanted item Disposition code Item repaired Miscellaneous charge 15 percent handling fee
Miscellaneous charge Ten percent repair charge
Set up miscellaneous charges for reason codes by clicking the Misc. charges button in the Reason codes form. For the disposition codes, set up miscellaneous charges by clicking the Misc. charges button in the Disposition code form.
Returns and Intercompany

Returns in Microsoft Dynamics AX 2009 also supports intercompany direct returns. In an intercompany setup, a user can have one company engaging directly with the end customer, and the sister company or subsidiary in the intercompany chain receiving the actual Return order. The created intercompany order chain resembles a standard direct delivery order, where the actual processing of the chain takes advantage of the Returns feature.
CAUTION: When you create intercompany Return orders, the default behavior is for the system to assign the same (RMA) number to the intercompany Return order as was assigned to the original Return order. This implies a risk for a conflict if the RMA number is already being used in the intercompany company (// Company B). To avoid this situation, the number sequence for Return order numbers must be set up according to the following rule: If two or more companies participate in an intercompany relationship with one another, they must set up different number series for Return orders, for example: In Company A: RMA_A_##### In Company B: RMA_B_##### Then, automatic assignment and synchronization of Return order numbers will work.
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Create a Return Order

The Return order is much like a Sales order and is therefore also characterized by a status that indicates what has been processed on the Return order. On the Return order, there is a header status field, as shown in the following table. Status Created Description Upon creation, the header status will be Created. This indicates that this is a planned Return order. The status on a Return order line is Awaiting. The order can be deleted or canceled, and a user can create new lines on a Return order with a status of Created. When the first item starts to arrive in inventory, the status of the Return order is changed to Open. The status on a Return order line can be either Awaiting, Registered, Received, Quarantine, or Invoiced. A user can create new lines on a Return order with status Open. When a Return order has been fully credited (all lines are invoice updated) the status will change to Invoiced, and the order cannot be opened again for additional processing The status on a Return order line is Invoiced. A user cannot create new lines on a Return order with a status of Invoiced. If the customer forgets to return an item, or if items never appear within a given time frame, a Return order can be canceled. The status on a Return order line is Canceled. A user cannot create new lines on a Return order with the status of Canceled.
Open
Invoiced
Canceled
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Return Order Form - Upper Pane
In the advanced view in the Return orders form, the order headers are in the upper pane and the lines for the Return order in the lower pane.
FIGURE 10.3 RETURN ORDERS FORM
The following options are available in the Upper pane: Function Find Sales order From the Setup button, miscellaneous charges can be set up for the Return order header From the Functions button, a user can perform the tasks shown in the following table Description Create a Return order by retrieving the information from the original Sales order, and the Sales order lines. A Return order is not required to be matched against a Sales order. Cancel the Return order.
Cancel Return order
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Function Send acknowledgement
Description Send an acknowledgement document to the customer to confirm that the returned items have arrived at the warehouse. Send the Return order document to the customer. Create an up-front replacement order for the items to be returned. This function lets you send replacement items to the customer before the defective items are returned. This helps when a customer, for example, must have the spare parts available before he or she can dismantle the defective item. The up-front replacement order is an alternative to the replacement order created as from applying a disposition code when the returned item has been inspected. Packing slip update the Return order.
Send Return order Create replacement order
Packing slip
Return Order Form - Lower Pane

In the Lower pane of the Return order form, the following options are available: From the Setup button, miscellaneous charges can be created for each line From the Functions button, a user can find a replacement item if the disposition code specifies replacement
Return Order Form - Line Status

The lines in the Return order form can have the statuses shown in the table. Line status Awaiting Registered Description On a created or open Return order, this status indicates that nothing has happened to the Return order line. This status indicates that items have been posted in the item arrival journal, either upon item arrival, or when it is returned from quarantine. This status indicates that items have been packing slip updated and received in inventory. This status indicates that items are currently in quarantine. This status indicates that the Return order line has been invoice credited. This status indicates that the Return order line has been canceled.
Received Quarantine Invoiced Canceled
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Procedure: Create a Return Order
To create a Return order, follow these steps. 1. Open the Return orders form from Accounts receivable > Return Order Details. 2. Click the New icon, or press CTRL+N, and then select a customer account in the Customer account field. 3. Specify a customer contact person and a reason code for returning the items, and then click OK. 4. Click Functions, Find sales order to open the Find sales order form, and then select the Mark check box on the line to be returned and update the Quantity to return field, if necessary. Or, if you do not want to associate the Return order with a sale order, you can select an item number in the Lines tab of the Return order form.
NOTE: The system prevents you from registering a customer return that is greater than the quantity that was sold to the customer, if the Return order is matched against the Sales order.
Microsoft Dynamics AX 2009 automatically fills in a return warehouse and expected deadline for returning the items. The deadline is calculated based on the setup of the Days of validity parameter found in the Accounts receivable parameters form, on the General tab. The status of the Return order is Created, and because the items have not arrived at inventory, there will be no inventory transactions for the Return order yet. However, there is a parameter named Allow reservation on the General tab of the Return order form that enables you to trigger the immediate generation of inventory transactions, in cases where returned goods are known to be in perfect condition.
BEST PRACTICE: Although only one warehouse and one delivery address can be selected on the Return order header, you can assign each return item line to a different warehouse (and address). If the customer sends the returned goods to the warehouse address quoted on the header, the receiving warehouse will not see all lines in the Arrival overview form if that location is filtering to view returns assigned to its warehouse only. To avoid this, assign all return lines to the same warehouse that is specified in the header. If you cannot do that because some items are set up with a mandatory sales warehouse, then create a separate Return order for each item and assign it to the appropriate warehouse in the Return order header.
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Lab 10.1 - Create a Return Order

Contoso Entertainment Systems - Company CEU Scenario You are a sales person at Contoso Entertainment Systems, and the customer Owl Wholesales calls to inform you that the three pieces of item number 1201 that they purchased from you on Sales order SO_100093 are defect. One of Owl Wholesales sales persons will be visiting your warehouse today, so you create a Return order and give the customer an RMA number that they must use when they deliver the defective items.
Challenge Yourself!
1. Create the Return order for customer with the details in the following table. Field Customer account Contact Return reason code group Return reason code Deadline Content 1202 Jacky Chen Defect 21 Today
2. Use the Find sales order feature to find the sales order line that is being returned by the customer; SO_100093 3. Print the Return order and note the RMA number.
Need a Little Help?

Open Accounts receivable > Return Order Details to open the Return order form. To find the sales order, click Functions > Find sales order in the Return order form.
Step by Step
1. Open the Return orders form from Accounts receivable > Return Order Details. 2. Click the New icon, or press CTRL+N, and then select a customer account 1202 in the Customer account field.
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3. Select the customer contact person in the Contact field. 4. In the Deadline field, select today's date. 5. Click the Return reason code field, and select the Return reason code group Defect, and then the Return reason code 21 6. Click OK to create the Return order header. 7. Click Functions, Find sales order to open the Find sales order form. 8. Select SO_100093 in the Sales order field. 9. Select the Mark check box on the line where Item number = 1201, and Quantity = 3. 10. Click OK. 11. Click Functions > Send return order to print the Return order. 12. Notice the RMA number.
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Item Arrival and Receipt Registration

You can use the Item arrival journal to register the receipt of items from customers. You can create an item arrival journal manually, or by using the Arrival overview form.
FIGURE 10.4 ARRIVAL OVERVIEW FORM - RETURN ORDER VIEW
When the status of the Return order in the Arrival overview form is Completed, it means that journals have been created and are ready to be registered. Item registration is performed from the Item arrival journal, which is accessed from Inventory management > Journals > Item arrival > Item arrival. On the journal lines, the user can select to: Send the returned items to quarantine Apply a disposition code Split an arrival registration
The disposition code applies to all the items on a journal line. If you want to dispose of some items differently, then you must split the line. Splitting the journal line will also split the corresponding Return order line.
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The journal can be posted when all lines either have a disposition code applied or are sent to quarantine. When the journal has been posted, the returned items not sent to quarantine will be registered in inventory.
Post Packing Slip

To receive the returned items into inventory, the order must be packing slip updated. Sammy, who is responsible for shipping and receiving, can perform this from the Arrival journal or Susan, the order processor, can perform this from the Return order form. As part of the packing slip posting, the packing slip reference number from the customer's shipping documents will be associated with the order lines. If not all expected return items have arrived, only the quantity that has actually arrived will be included in the packing slip updating and a new return line will be created for the remaining quantity. The rest will wait for the next return shipment order to arrive. When you packing slip update the Return order, the system creates replacement orders according to the disposition code settings on the lines.
Post Invoice
Because a Return order is basically a Sales order of type Returned order, the usual Sales order invoicing process is applied and used. You can only invoice-update the Return order and create the credit note from the Sales order form or from Accounts Receivable > Periodic > Sales update > Invoice. It is not possible to invoice update a Return order from the Return order form.
Scenario: Initiate the Arrival of a Return Order Arrival

Sammy, who is responsible for shipping and receiving, has created a special view in the Arrival overview form only for customer returns. Because customer returns typically represent a small percentage of the actual arrivals, it is usually easier for Sammy to locate a return and confirm its arrival. The customer may never decide to return the item(s). In these cases Lisa, in customer service, cancels the authorized Return order. If returned items arrive at the warehouse, Sammy will start to search for them by trying to match the RMA number on the attached shipping documents to the RMA number in his item arrival overview. When the RMA number is located, Sammy will start the arrival process.
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When the arrival process is started from the Arrival overview form, the system will automatically create a journal that contains the necessary data to start the registering process. The item arrival journal will be prefilled with the required reference information, such as customer ID, lot number, return quantity expected, and more. When the arrival process starts, the system creates inventory transactions for the returned items. Sammy can then select between two methods to register the arrival of returned items: Create an arrival journal from the Arrival overview form Create an item arrival journal manually
Scenario: Determine the Disposition of a Return Order on Arrival

Sammy checks the returned items that have arrived. He counts the quantity and verifies the state of the returned items. If the returned items must have an additional inspection, Sammy specifies that the journal line should go to quarantine and posts the journal. If the items are sent for inspection in the quarantine warehouse, a Quarantine order will be created by the system. This will be processed by Ricardo, the quality controller, who inspects the items and applies a disposition code.
NOTE: If the returned item belongs to an Inventory model group that has the Quarantine management parameter enabled, the returned item must go through quarantine.
If the returned items are determined undamaged, Sammy may select to add them to inventory. Sammy specifies a disposition code and a warehouse where they can be returned to, and posts the arrival journal.
Procedure: Process the Arrival of a Return Order Arrival from the Arrival Overview Form
To process the arrival of a Return order, follow these steps: 1. Open the Arrival Overview form from Inventory management > Periodic > Arrival overview. 2. To view Return orders, select the option Return order in the Setup name field on the Overview tab.
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a. This filters on Return orders only, and Return orders with outstanding arrivals are now displayed in the Receipts pane on the Overview tab. b. In the Range field group in the Arrival overview form, a user can search for a specific Return order by, for example, entering the RMA number or the item number. 3. When the correct Return order has been located, select the Select for arrival check box for header and lines as appropriate, and then click the Start arrival button. When you click the Start arrival button, Microsoft Dynamics AX 2009 automatically creates a new journal header and journal lines that correspond to the lines selected in the Arrival overview form. 4. Click Journals > Show arrivals from receipts, and then click Lines. 5. Select a Disposition code on the General tab, and then click Post to post the journal. 6. Close all forms. You can also select multiple Return orders when an arrival is started. Each Return order line is copied to an item arrival journal line.
Procedure: Post the Packing Slip

After the arrival of the Return order has been processed, you can post the packing slip. To do this, follow these steps: 1. 2. 3. 4. Open Accounts receivable > Return Order Details. Select the Return order that you want to packing slip update. Click Functions > Packing slip. Click OK.
You can also post the packing slip from the Arrival overview form, by clicking Journals > Packing slip ready journals.
Procedure: Post the Invoice

To invoice the Return order, follow these steps: 1. Open Accounts receivable > Sales Order Details. 2. Locate the Sales order of the Returned order type, that has been automatically created from the Return order. 3. Click Post > Invoice and post in the same manner as a Sales order.
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Receipt in Progress
The Receipt in progress field indicates the progress of the Return order. A Return order can have the following three statuses as shown in the table. Status None Partly Complete Description None of the lines in the receipt are registered in an arrival journal. At least one of the lines in the receipt is registered in an arrival journal. All the lines in the receipt are registered in an arrival journal.
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Lab 10.2 - Process a Return Order

Contoso Entertainment Systems - Company CEU Scenario You are the warehouse worker at Contoso Entertainment Systems, and you have received the returned items from the customer Owl Wholesales, with the RMA number that you created in the Lab - Create a Return Order. You determine that the items are defective and start the arrival of the Return order. You post the Arrival journal with a disposition code to reflect that the items will be repaired and that customer will be credited.
Challenge Yourself!
1. Start the arrival of the Return order. 2. Apply a disposition code to the journal that reflects that you will credit the customer, and when the items are repaired, they will return to inventory. 3. Post the journal.
Need a Little Help?

1. Use the Arrival overview form in Inventory management > Periodic to start the return item arrival. 2. Remember to filter for Return orders. 3. Use Journals > Show arrivals from receipts to open the Journals form.
Step by Step
1. Open the Arrival Overview form from Inventory management > Periodic > Arrival overview. 2. Select Return order in the Setup name field on the Overview tab. 3. Click the Select for arrival check box on the Return order that you created in Lab - Create a Return Order. 4. Click the Start arrival button. Microsoft Dynamics AX 2009 automatically creates a new journal header and journal lines that correspond to the lines selected in the Arrival overview form. 5. Close the infolog. 6. Click Journals > Show arrivals from receipts, and then click Lines. 7. Select 12 in the Disposition code field on the General tab
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8. Click Post and then click OK in the next window. 9. Close the forms.
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Lab 10.3 - Post the Packing Slip and Invoice

Contoso Entertainment Systems - Company CEU Scenario You are a sales person at Contoso Entertainment Systems, and you have been informed by the warehouse worker that the Return order that you created in Lab Create a Return order has been delivered by the customer.
Challenge Yourself!
Post the packing slip and invoice the customer, to create a credit note for the returned items.
Need a Little Help?

1. Open the Return order in Accounts receivable > Return Order Details. 2. Use the Functions button to open the post the packing slip. 3. The Return order is invoiced from the Sales order form.
Step by Step
1. Open Accounts receivable > Return Order Details. 2. Select the Return order that you created in Lab - Create a Return Order. 3. Click Functions > Packing slip. 4. Click OK, and close the Return orders form. 5. Open Accounts receivable > Sales Order Details. 6. Locate the Sales order of the Returned order type, that has been automatically created from the Return order. 7. Click Post > Invoice and post in the same manner as a Sales order.
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Quarantine Orders
By enabling Sammy, who is responsible for shipping and receiving, to indicate on a returned item that it must visit inspection, Sammy will not have to make any decisions on the disposition of the item, but leave it up to Ricardo, the quality controller, to decide. When Sammy has specified that the item must go in quarantine and posted the item arrival, Ricardo will automatically have a Quarantine order for the returned item. Ricardo must then update the Quarantine order with his decision on the disposition of the item, and the system will update the Return order accordingly. The following scenarios describe how to cover the overall Quarantine order process for Return orders.
Scenario: Pass Returned Items on to Inspection

Sammy is looking at the items that have arrived and finds the returned items. He evaluates the returned items by looking at the packaging and the overall condition, and if the returned items are in an acceptable condition, he can return them to inventory. Sammy will specify a disposition code and post the item arrival. If the returned items are in a poor condition and require more investigation, Sammy will indicate in the system that the returned items must be sent to inspection for additional processing. He selects the Quarantine management check box and posts the arrival journal. The company may also have a policy that all returned items should go to quarantine.
Scenario: Create a Quarantine Order Automatically

When Sammy, who is responsible for shipping and receiving, has selected the Quarantine management check box for the returned items and posted the arrival journal, the system will automatically create a Quarantine order for the returned items. A Quarantine order can only be associated with a single item number. Therefore, if Sammy selects to send ten different returned items to quarantine, ten individual Quarantine orders will be created for Ricardo, the quality controller, to process.
Scenario: Apply a Disposition Code to a Quarantine Order

Ricardo, the quality controller, inspects the returned item(s) and decides how to dispose of them. If it is required, he will split the Quarantine order to apply different disposition codes to the returned items.
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Scenario: Report as Finished/End a Quarantine Order
Depending on the setup of the Warehouse management, Ricardo, the quality controller, performs one of the following tasks: Reports the Quarantine order as finished, that is, he releases the returned item(s) and creates an item arrival journal entry. Sammy later processes the journal and returns the items to inventory. Sammy cannot change the disposition code that Ricardo has updated. Ends the Quarantine order by moving the inspected items directly back into inventory.
Scenario: Dispose of the Returned Items

When the items have been returned from quarantine with a disposition code, the later packing slip updating and / or invoice updating of the Return order will implement the actual scrapping, crediting, or returning actions specified by the disposition code.
Replacement Orders
If your customer returns an item that is defective or incorrect, you can create a Replacement order to use to send the new items to the customer. Replacement orders are usually created after a product is returned and inspected. However, when an item must be replaced before it has been returned, or when the original item will not be returned, you can create a Replacement order immediately after you create a Return order.
Procedure: Create a Replacement Order

To create a replacement order, follow these steps. 1. Click Accounts receivable > Return Order Details to open the Return orders form. 2. On the Overview tab, select the appropriate return order. 3. Click the Functions button and then click Create replacement order to open a Create sales order form. 4. Select the Copy return order lines check box to transfer details from the Return order you selected on the Return orders form to this Sales order. 5. Enter or modify details as necessary. 6. Click OK to close the Create sales order form, and then open the Sales order form to continuing working on this order. Notice that the RMA number is copied to the Sales order, on the References tab.
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Reports and Statistics

The purpose of the return reports and statistics is to provide a company with an overview of how the return processes are working, what the volume of the Return orders is and how it affects the business. The reports and statistics within returns can be used for several purposes, for example: To determine the volume of returns for a given period and how it is distributed over items and customers To measure the time that is spent on handling customer returns To judge if the return process is well managed or uncontrolled
The following reports are available from Accounts receivable > Reports > Return orders: Return volume Return statistics ranking Return cycle time
Return Volume
Use the Return volume report to prepare a report about the volume of returns for each item or customer and the time that you spend on handling customer returns. You can print in general or batch mode. You can find the Return volume report in Accounts receivable > Reports > Return orders > Return volume. Scenario: Determine the Volume of Returns for a Given Period Vince, the operations manager, wants to obtain a quick overview of what the level of returns is for the last fiscal quarter. He runs the Return volume report grouped by month and return reason codes. Scenario: Investigate the Nature of Customer Returns Ricardo, the quality controller, is preparing his input to the monthly operations managers meeting. He prints a report that displays the returns for the last twelve months, grouped by return reason code.
Return Cycle Time

Use the Return cycle time report to prepare a report about the time that is required to handle return issues. This can be calculated as the internal time cycle, external time cycle, or full-time cycle.
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You can find the Return cycle time report in Accounts receivable > Reports > Return orders > Return cycle time. Scenario: Determine the Return Cycle Time Kevin, the sales manager, has had customer complaints that the company takes too long to handle returns. He examines the Return cycle time report that displays the average, maximum, and minimum return cycle times for the various return reason codes over the last year. Scenario: Estimate Capacity Requirements for Return Items Ellen, the warehouse manager, wants to investigate if their current inventory return locations are too spacious or insufficient. She examines the Return cycle time report that displays the number of returns and return cycle times for the last six months.
Return Statistics Ranking

Use the Return statistics ranking report to prepare a report about the volume of returns for a given period and how they are distributed over items and customers. You can find the Return statistics ranking report in Accounts receivable > Reports > Return orders > Return statistics ranking. Scenario: Determine High Return Volumes Customers Kevin, the sales manager, wants to determine those customers who have an unusually high percentage of returns. He examines the Return statistics ranking report that displays the top ten customers who have the most returns. Scenario: Determine the Volume of Returns for Individual Items Tony, the production manager, wants to see whether he can discover any patterns in the return items that might indicate that the production is unstable. He examines the Return statistics ranking report that displays the top ten returned products for the last six months.
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Summary
Customer Returns discussed how to set up and use the returns functionality in Microsoft Dynamics AX 2009. Return management helps a company to systemize customer returns and improve the efficiency of customer service and customer satisfaction. Additionally, you can print various reports to provide an overview of the following: The volume of returns for each item or customer The time that is spent on handling customer returns How well the return process is managed
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Test Your Knowledge

Test your knowledge with the following questions. 1. As part of the item arrival and inspection, a Disposition action will be assigned to returned goods to specify how to dispose of the return goodsm, how to handle the return financially, and if a replacement item must be sent to the customer. What happens with the predefined Disposition action "Credit"? ( ) Scrap item, create replacement order, credit customer ( ) Put item back into inventory, credit customer ( ) Do not return item, only credit customer, or customer scraps item, credit customer ( ) Put item back item into inventory, create replacement order, credit customer 2. When a Return order line is created, or open and nothing has happened to it yet, what is the status of that line? ( ) Canceled ( ) Awaiting ( ) Open ( ) Created 3. What is the name of the form where you perform the invoice of the Return order? ( ) Return order form ( ) Arrival overview form ( ) Sales order form ( ) Location journal form
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2.
3.
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Solutions
Test Your Knowledge
1. As part of the item arrival and inspection, a Disposition action will be assigned to returned goods to specify how to dispose of the return goodsm, how to handle the return financially, and if a replacement item must be sent to the customer. What happens with the predefined Disposition action "Credit"? ( ) Scrap item, create replacement order, credit customer () Put item back into inventory, credit customer ( ) Do not return item, only credit customer, or customer scraps item, credit customer ( ) Put item back item into inventory, create replacement order, credit customer 2. When a Return order line is created, or open and nothing has happened to it yet, what is the status of that line? ( ) Canceled () Awaiting ( ) Open ( ) Created 3. What is the name of the form where you perform the invoice of the Return order? ( ) Return order form ( ) Arrival overview form () Sales order form ( ) Location journal form
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Chapter 11: Over/Under Delivery and Miscellaneous Charges
CHAPTER 11: OVER/UNDER DELIVERY AND MISCELLANEOUS CHARGES

Objectives
The objectives are: Set up the Accounts receivable and Accounts payable modules to accept over and under delivery. Set up acceptable over and under delivery percentages on an item. Manage over and under deliveries in sales and Purchase order processing. Set up a miscellaneous charges group for customers, vendors, and items. Assign miscellaneous group to customers, vendors, items, and orders. Add price miscellaneous charges to an item that are dependent or independent of the item quantity. Set up miscellaneous charges codes. Manually add miscellaneous charges to a Sales and Purchase order. Manually add miscellaneous charges to the Purchase order lines. Set up automatic miscellaneous charges for a specific customer, item, or item group. Modify or delete the automatic miscellaneous charges. Set up and use landed costs. Add or change miscellaneous charges during the Purchase order invoicing process.
Introduction
Variability in a company's internal and supplier performance can cause significant backorder administration to manage even small differences in quantities ordered and received. The over delivery and under delivery functionality in Microsoft Dynamics AX 2009 can be used where the received or delivered quantity of an item fluctuates occasionally and it is not significant enough to be managed as a backorder. The Over/Under Delivery lesson introduces an effective way to manage small differences between ordered and received quantities when an order with only a partial quantity must be closed without administering backorders.
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Miscellaneous charges are additional costs added to sales and Purchase orders such as freight, transport, postage, insurance, packaging, and fees. The miscellaneous charges capabilities in Microsoft Dynamics AX 2009 lets companies eliminate data entry by assigning charges to items, customers, and vendors when charges frequently occur, or are required. You can set up miscellaneous charges so that they are included in sales and purchase transactions automatically or you can add them manually to the orders to accommodate one-time charges. The Miscellaneous Charges lesson discusses how to manage miscellaneous charges in sales and Purchase orders.
Over/Under Delivery
To avoid unnecessary backorder handling every time that an order is slightly over- or under-delivered, you can configure Microsoft Dynamics AX 2009 so that such deliveries are accepted, if they are within predefined ranges from the originally ordered quantity. You can close and fully invoice these orders. This functionality will most likely be used for particular kinds of items that are delivered by weight, in bulk, or in linear feet. These kinds of items are also low in value and carrying costs, frequently ordered, and easily sourced. Examples of these items are screws, brackets, and pins.
EXAMPLE: Contoso Entertainment Systems has run low on its stock of lamp projectors. The purchasing agent puts in an order with the vendor for 1000 lamp projectors. Typically, there is a one to two percent variance on the number of lamp projectors received when ordering from this vendor, but they offer the best price. Because of the variance, Contoso Entertainment Systems and the vendor have agreed to set up an over/under delivery variance to allow for a difference of two percent because it is not cost-effective for either company to create new orders or credit memos. When the order arrives, there are 1018 pieces in the order. The order is accepted because it is in the range that is specified in the over/under delivery setup. Six months later, the stock is down to 500 so another order is put in for 500 from the same vendor. This time, the order contains 492 lamp projectors. Again, the order is accepted because it is in the range of over/under delivery setup.
Over/Under Delivery Setup

Set up an item to accept over/under-delivery by using a two step process: 1. Set up Accounts receivable and Accounts payable parameters to accept over/under delivery. 2. Define the acceptable tolerance percentage for over/under delivery on the item.
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Parameters
To perform the first step in the over/under-delivery setup, you must set up the appropriate parameter for both the Accounts receivable and Accounts payable modules. These settings are global and affect all Sales orders and Purchase orders. To set up the parameters for Sales orders, open Accounts receivable >
Setup > Parameters.
To set up the parameters for Purchase orders, open Accounts payable > Setup > Parameters.
FIGURE 11.1 ACCOUNTS RECEIVABLE PARAMETERS FORM - ACCEPT OVER/UNDER DELIVERY
Accept Over/Under Delivery

For both setup areas, on the Updates tab, under the General field group, set the global parameter to allow for over delivery, under delivery, or both. If you select Accept overdelivery, you can receive or sell more items through the packing slip or invoice update than the quantity ordered in the purchase or sales line. If you select Accept underdelivery, you can receive or sell fewer items through the packing slip or invoice update than the quantity ordered in the purchase line or sales line. If you neither select Accept overdelivery nor Accept underdelivery, you cannot close purchase and Sales orders until the precise quantity ordered is received or delivered. This keeps a demand in the system for those backorders that still have to be fulfilled.
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Close a Partly Delivered Order
If you neither select Accept overdelivery nor Accept underdelivery, you have two ways to close a partly delivered sales or Purchase order and relieve the demand for backorder: If part of the quantity is received or invoiced, the remaining quantity can be canceled by going to Functions > Deliver remainder > Cancel quantity on the order line. You can update the quantity on the Sales order line.
Procedure: Set Up Tolerance on an Item

You must define the acceptable tolerance for over and under delivery for the item. Tolerance is expressed as a percent so that it can be scalable with every order. To set up the acceptable tolerance for a specific item, follow these steps: 1. Open Inventory management > Item details. 2. Select the item and then click the References tab. 3. Under the Purchase order and Sales order field groups, specify the acceptable tolerance in the Overdelivery and Underdelivery fields.
NOTE: When you add an item to a sales or Purchase order, the specified percentages are defaulted onto the order line. To make exceptions, you can override these values. When a new item is created, the default setting for the acceptable tolerance is 0%.
Over/Under Delivery Transactions

The over and under delivery functionality is generally the same for Sales orders as it is for Purchase orders. However, both situations are demonstrated: one where the over and under delivery is set up on the order and one where the over and under delivery is set up on the item. In the following two demonstrations, parameters in the Accounts payable and the Accounts receivable modules are set up to accept over and under deliveries.
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Demonstration: Create a Purchase Order
Contoso Entertainment Systems needs 7000 pieces of item number 5012, 4-40 zinc nut, in the production. To ensure that the items can go into production immediately, the purchasing agent orders a quantity of 9000 in case any of the items are defective. 1. Open Accounts payable > Purchase Order Details and then create a new Purchase order for 9000 4-4 zinc nuts from vendor 4101, Discrete Parts Suppliers 1. The vendor can deliver 8000 pieces but because this will meet the current needs, you tell the vendor not to deliver the backorder for the 1000 pieces. Now you want to receive the 8000 pieces and close the order so no backorders remain. 2. When the order line is highlighted in the Purchase order, enter the 8000 pieces in the Receive now field on the Quantity tab. 3. Click the Posting > Packing slip to update the order. 4. In the Posting packing slip form, ensure that Receive now is selected in the Quantity field under the Parameters field group. 5. Type a packing slip number in the Packing slip field. 6. On the Lines tab, select the Close check box to close the order and then click OK.
NOTE: If you do not use the packing slip update step, you can close the order in the invoice update step.
Demonstration: Underdeliver a Purchase Order

Microsoft Dynamics AX 2009 will reject the posting and give the error Underdelivery of line is 11.11 percent, but the allowed underdelivery is only 0.00 percent. Update has been canceled.
NOTE: The calculation of the under delivery is rounded up to two decimal points.
Notice that the error provides you the calculated percent of the quantity that you are trying to post. To manually override the default item tolerance settings and close this order, you must return to the Purchase order. 1. Highlight the Purchase order line and then click the Setup tab. Specify the value from the error 11.12 in the Underdelivery field. Remember that the number in this field represents a percent, not pieces. The Receive now quantity must still be 8000 pieces. 2. Click Posting > Packing slip. Enter the packing slip number, select the Close check box, and then click OK to post. This time, the order is posted and the order status changes to Received and there is no backorder.
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Demonstration: View Purchase Order Transactions
To view the transactions on the Purchase order, follow these steps: 1. Click Inquiries > Packing slip. 2. Click the Lines tab and you see that 75 were ordered and 70 were received. Also, there is no remaining quantity to be delivered because the order was closed.
BEST PRACTICE: If you must frequently manually adjust the accepted under and over delivery percent for an item on the order, specify a tolerance on the item to reduce the number of steps required every time you receive the item.
Demonstration: Create a Sales Order

Customer 2021, Graphic Design Training Center, orders 90 pieces of item number 1303, with configuration 01. A long-standing relationship with this customer has been established and this is a typical order for them. During a production of 90 pieces, you sometimes have scrap and nonconforming parts. To accommodate this, you always do a production run of 95 pieces. The customer recognizes this and accepts the fact that you may ship a bit less or more and has decided on a five percent tolerance, over or under, on an order of 90 pieces. 1. Open Inventory management > Item details and locate item number 1301. 2. On the Reference tab, set up an over-delivery tolerance of five percent and an under-delivery tolerance of five percent for Sales orders. This allows for order lines to be closed when the quantity falls within five percent of what is ordered. 3. Open Accounts receivable > Sales Order Details, and create a new Sales order with a Sales order line for 90 pieces of the item number 1301, configuration 01 (black) for customer 2021, Graphic Design Training Center. Click No to override the suggested order quantity.
Demonstration: Underdeliver a Sales Order

After a production run, you can ship 85 pieces of item number 1303 - black, to the customer Graphic Design Center. Ship these pieces and close the order. 1. Highlight the Sales order line and then enter the 85 pieces in the Deliver now field on the Quantity tab. 2. Click Posting > Packing slip to packing slip update the order. 3. In the Posting packing slip form, ensure Deliver now is selected in the Quantity field under the Parameters field group. 4. On the Lines tab, select the Close check box to close the order and then click OK.
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The posting is rejected and gives the error Underdelivery of line is 5.56 percent, but the allowed underdelivery is only 5.00 percent. Update has been canceled. Notice that the error gives the calculated percent of the quantity you are trying to post.
Demonstration: Under/Over Deliver a Sales Order

Knowing that the customer will not accept this order, you will create another production run for six pieces. All six pieces from the production are received this time. Now try to packing slip update the order to ship the customer 91 pieces. 1. Highlight the Sales order line and enter 91 (85+6) in the Deliver now field on the Quantity tab. 2. Click Posting > Packing slip.
NOTE: When you overdeliver an item, you do not have to select the Close check box; the system will consider the order fulfilled.
3. Select Deliver now in the Quantity field and then click OK . The order is posted, the 91 pieces are shipped to the customer, and the order status changes to Delivered. To view the transactions on the Sales order, follow these steps: 1. Click Inquiries > Packing slip. 2. Click the Lines tab and notice that 90 were ordered and 91 were delivered.
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Lab 11.1 - Use Over/Under Delivery with Purchase Orders

Contoso Entertainment Systems - Company CEU Scenario You are the purchasing agent for Contoso Entertainment Systems and have received a requisition for 1000 of item number 5003, binding posts. You remember that frequently, when you purchase this item, you receive slightly more or less than the ordered amount. Because this vendor, Trey Parts, offers the best price, you, your manager, and the accounting manager agree to set up an over and under delivery variance of five percent for this item for both sales and purchases.
Challenge Yourself!
1. Verify that Microsoft Dynamics AX 2009 is set to accept over and under deliveries in the Accounts receivable and Accounts payable modules. 2. Set up item number 5003 with the five percent variance for both sales and purchases. 3. Create the Purchase order for 1000 pieces of item 5003, with vendor 4102. 4. When the order is received, it contains 1007 of item 5003. Because this amount is within the five percent variance, post the Packing slip. The Packing slip number is 3307.
Need a Little Help?

The set up for an item to accept over and under delivery is located in the Items form on the References tab. Before you packing slip update the Purchase order, specify the quantity 1007 for the order line in the Receive now field on the Quantity tab. On the Posting packing slip form, ensure that you only update the quantity that you receive now, and then close the order.
Step by Step
To verify that the Accounts receivable and Accounts payable modules are set up to accept over and under delivery, follow these steps: 1. Click Accounts receivable > Setup > Parameters. 2. Click the Updates tab and verify that the Accept underdelivery and Accept overdelivery check boxes are selected. 3. Close the Accounts receivable parameters form.
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4. Click Accounts payable > Setup > Parameters. 5. Click the Updates tab and verify that the Accept underdelivery and Accept overdelivery check boxes are selected. 6. Close the Accounts payable parameters form. To set up item 5003 with the five percent variance for both sales and purchases, follow these steps: 1. Click Inventory management > Item details. 2. Select the 5003 item and then click the Reference tab. 3. In the Overdelivery and Underdelivery fields, in the Purchase order field group, enter 5. 4. In the Overdelivery and Underdelivery fields, in the Sales order field group, enter 5. 5. Close the Items form. To create the Purchase order for 1000 pieces, follow these steps: 1. 2. 3. 4. 5. 6. Click Accounts payable > Purchase Order Details. In the Advanced view, press CTRL+N. Select Vendor account 4102. Click Yes to transfer vendor information and then click OK. Select item 5003 in the Item number field. In the Quantity field, enter 1000.
To packing slip update the order with the quantity 1007, follow these steps. 1. To post the receipt, click the Quantity tab on the Purchase order line. 2. In the Receive now field, enter 1007. 3. Click Posting > Packing slip. 4. In the Posting packing slip form, select Receive now in the Quantity field, and in the Packing slip field, type 3307. 5. Click OK. The Packing slip posted without error because the quantity received is within the over delivery of the five percent variance.
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Lab 11.2 - Use Underdelivery with Sales

Contoso Entertainment Systems - Company CEU Scenario You are a new order processor for Contoso Entertainment Systems. You have received an order for 100 of item number 1164 from customer Forest Wholesales. You create the Sales order for Forest Wholesales, but can only deliver 92 from stock. When the Packing slip is posted for the 92 items, you discover that this item is set up with a variance of five percent. You contact the warehouse and are informed that an order for this item was recently canceled and there are six more available to ship.
Challenge Yourself!
1. Create the Sales order for 100 pieces of item 1164, configuration 01, and prepare to ship the order for 92 items. 2. Try to post the packing slip for 92 of item 1164. 3. Add another six pieces of item 1164 and post the packing slip again.
Need a Little Help?

Create the Sales order from the Accounts receivable module. On the order line, set the quantity to 92 in the Deliver now field on the Quantity tab. Packing slip update the Deliver now quantity. Add the additional six items in the Quantity tab of the Sales order and packing slip update again. Ensure that you only update the quantity that you deliver now (98) and remember to close the order.
Step by Step
To create and post the Sales order, follow these steps: 1. 2. 3. 4. 5. 6. 7. 8. 9. Click Accounts receivable > Sales Order Details. In the Advanced view, press CTRL+N. Select Customer account 1101. Click Yes to transfer customer information and then click OK. Select item 1164 in the Item number field. Select 01 in the Configuration field. In the Quantity field, enter 100. Click the Quantity tab and enter 92 in the Deliver now field. Click Posting > Packing slip.
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10. In the Posting packing slip form, select Deliver now in the Quantity field. 11. Click the Lines tab and select the Close check box. 12. Click OK. A message appears about printing, click OK. The Packing slip does not post because the quantity to deliver is not within the five percent variance, it is eight percent. 13. In the Infolog, click Close. To add the additional six items from the canceled order to the Sales order and try to post the Packing slip again, follow these steps. 1. On the Sales order line, on the Quantity tab, type 98 in the Deliver now field. 2. Repeat steps 9 through 12. The Packing slip posted without error because the quantity delivered is within the five percent variance.
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Miscellaneous Charges
Miscellaneous charges are costs and fees that you can add to the cost of items, sales, and purchases according to the setup. The following are examples of miscellaneous charges: Freight Transport Postage Insurance Recycling Packaging
Methods of Adding Miscellaneous Charges

There are three ways of adding miscellaneous charges in Microsoft Dynamics AX 2009: Price miscellaneous charges: This is a fixed charge set up for a specific item, for example, a startup fee that is charged every time that the item is traded. The Price misc. charges feature is set up on the Items form. Manual set up of miscellaneous charges: You can add this kind of charge manually to the order header or order line of a sales or Purchase order. An example is a one-time fee that is charged to the whole order or a specific line on an order. You can also add this kind of charge to Purchase order invoice header or lines. This charge is set up in the Accounts receivable or Accounts payable modules under Setup > Misc. charges. Automatic set up of miscellaneous charges: This kind of charge is set to automatically add miscellaneous charges when you create a purchase or Sales order. This charge is set up in the Accounts receivable or Accounts payable modules under Setup > Misc. charges > Auto-misc. charges. The charge can be added to: o o o o o o A specific item An item misc. charges group A specific customer or vendor A customer or vendor misc. charges group All items, customers, or vendors A combination of the above
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Price Miscellaneous Charges

A price miscellaneous charge is an amount that is added to the price of an item. A miscellaneous charge might be production and setup costs, fees, or freight. You can set up price miscellaneous charges with either of the following methods: Independent of the quantity of the items. The miscellaneous charge is a fixed amount that is added to the order price independently of the item quantity. Whether ten or twenty items are sold, the miscellaneous charges on the order line are the same. Dependent on the quantity of items. The miscellaneous charge is calculated based on the item quantity and added to the order line.
Price miscellaneous charges are set up on the Price/Discount tab of the Items form, and on price agreements.
Price Miscellaneous Charges Settings

The settings for price miscellaneous charges are specified for purchase prices, cost prices, and sales prices under the relevant Base purchase price, Base cost price, and Base sales price field groups. When you set up price miscellaneous charges, use the fields shown in the table. Field Price misc. charges Description Price misc. charges is a fixed amount added to the price of the item, for example, attaching a miscellaneous charge of 80 U.S. dollars (USD) to a sales price of 100 (USD). When you create an order for the item, the Unit price field for the order line displays 100 USD, and 80 USD is added to the Net amount field. Price quantity is the quantity that you can use when allocating the specified Price misc. charges on price for each unit. For example, if you want to add 10 USD to the order every time 20 of these items are traded, you must specify 20 in the Price quantity field. Incl. in unit price divides miscellaneous charges by the number that is specified in the Price quantity field and adds them to the price specified in the Price misc. charges field. You must select the Incl. in unit price check box when the miscellaneous charge is dependent on the quantity of items traded.
Price quantity
Incl. in unit price
NOTE: Any Trade agreements that are set up for a vendor override the price/discount specifications on an item. To view possible Trade agreements, click Accounts payable > Vendor Details > Trade agrmt > Purchase prices.
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Example: Add Miscellaneous Charges that are Independent of the Item Quantity
An item costs 10 USD and when you purchase it, an additional 2 USD is added to the total price to cover the cost of transport. Instead of always adding the 2 USD charge on the Purchase order line, the price miscellaneous charge is added to the item to ensure that the charge is always included. This charge is specified in the Items form for that particular item on the Price/discount tab. The setup of the parameters in the Base purchase price field group is as follows: Price: 10.00 Price unit: 1.00 Price misc. charges: 2.00
When you create a Purchase order for five of these items, the Net amount on the Purchase order line shows 52.00 USD because the 2 USD misc. charges is added to the price for all five items. View the total of the miscellaneous charges by clicking the Price/discount tab on the Purchase order line and viewing the Purchase misc. charges field.
Example: Add Miscellaneous Charges that are Dependent on the Item Quantity
An item costs 10 USD, and when you purchase the item, a 2 USD charge is added for each set of ten. This also means that if only one of these items is purchased, one tenth of the amount indicated in the Price misc. charges field is added to the line item; this is specified in the Items form for that particular item on the Price/discount tab. The setup of the parameters in the Base purchase price field group is as follows: Price: 10.00 Price unit: 1.00 Price misc. charge: 2.00 Price quantity: 10.00 Incl. in unit price: Selected
When you, for example, create a Purchase order for one item, the Net amount field on the Purchase order line shows 10.20 USD because one tenth (0.20 USD) of the Price misc. charges is added to the price for one item. If you create a Purchase order for ten items, the Net amount field shows 102.00 USD because the whole Price misc. charges value, 2.00 USD, is added to the price because ten items are purchased.
NOTE: When a fixed charge is specified on the Items form, the posting of the miscellaneous charges added is considered part of the price and included in the calculations of inventory value and margin.
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Miscellaneous Charges Codes

To add manual and automatic miscellaneous charges when creating a sales or Purchase order, you must set up miscellaneous charges codes. The miscellaneous charges codes are used to specify the kind of charge and how the charge is debited and credited. Set up Miscellaneous charges codes in both the Accounts receivable and Accounts payable modules by clicking Setup > Misc. charges > Misc. charges
codes.
FIGURE 11.2 MISC. CHARGES CODE FORM - ACCOUNTS PAYABLE
The Misc. charges codes form contains two tabs: Overview Posting
Overview Tab
On the Overview tab, specify the fields and use the buttons shown in the following table. Field Misc. charges code Description Description A unique identifier for the charge. A short description of the charge.
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Field Item sales tax group Intrastat Language texts button
Description An item sales tax group that can be used for calculation of taxes on the miscellaneous charge. Determines whether the charge is included in Intrastat transactions. Opens the Misc.charges code form where you can enter alternative language codes for the selected miscellaneous charges code. These language codes are then used to print the charges text in the language assigned to the customer or vendor. Opens the External codes form, where you can create or update external codes related to the selected miscellaneous charges code. External codes are used with external transactions, such as Application Integration Framework, EDI, or intercompany processing.
External codes button
Posting Tab
Use the Posting tab to specify how to automatically debit and credit the charge.
FIGURE 11.3 MISC. CHARGES CODE FORM > POSTING TAB - ACCOUNTS PAYABLE
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The following fields exist for both Debit and Credit field groups: Type: Determines who or what carries the charge. The options are as follows: o o o Item: A unit charge is added to the item cost, for example, a landed cost. Ledger account: The charge is incurred internally. Customer/Vendor: The customer or vendor incurs the charge.
Posting: Identifies a posting description. This field is required if the Type field is set to Ledger account. Account: Specifies the ledger account that must be debited or credited, when the Type field is set to Ledger account. Compare purchase order and invoice values: This field only appears for Accounts payable miscellaneous charges. It is only enabled when the Debit or Credit type is Customer/Vendor. This option determines if miscellaneous charges transactions with this Misc. charge code will be included in Accounts payable Purchase order invoice matching.
Miscellaneous Charge Codes - Sales

There are two setups for sales in the Posting tab of the Misc. charges codes form that are used to determine who is responsible for the charge: Customer: The customer pays the charge and the charge is added to the Sales order totals. Internal: The charges are incurred internally and do not appear on sales transactions.
NOTE: You cannot use the Item miscellaneous charge in the Accounts receivable module. If the Type Item is selected on the Posting tab of the Misc. charges codes form, an Info log appears, stating that Misc. charges on item cannot be used.
Procedure: Set Up Miscellaneous Charges Codes for Sales

To set up the miscellaneous charges codes for sales, follow these steps:
1.
Open Accounts receivable > Setup > Misc. charges > Misc. charges
codes.
2. Press CTRL+N to add a new code. 3. In the Misc. charges code field, type a unique identifier for this miscellaneous charge. 4. In the Description field, type a short description of the charge. 5. Click the Item sales tax group arrow and select the sales tax group.
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6. Select the Intrastat check box if this miscellaneous charge must be considered in Intrastat transactions for trade with countries/regions in the European Union (EU). 7. Click the Posting tab. 8. Determine who is responsible for the charge by using the information displayed in the following table. Debit Type Customer Specify Customer/ Vendor Ledger account Debit Posting not applicable Specify Debit Account not available Specify Credit Type Ledger account Ledger account Credit Posting Specify Specify Credit Account Specify
Miscellaneous Charge Codes - Purchases

There are three setups for purchases in the Posting tab of the Misc. charges codes form that are used to determine who is responsible for the charge: Item Internal Vendor
NOTE: The Item miscellaneous charge cannot be used in the Accounts payable module as Credit Type. If the Credit Type item is selected on the Posting tab of the Misc. charges codes form, an Info log appears, stating that Misc. charges on the item cannot be used.
Procedure: Set Up Miscellaneous Charges Codes for Purchases

To set up the miscellaneous charges codes for purchases, follow these steps:
1.
2. 3. 4. 5. 6. 7.
Open Accounts payable > Setup > Misc. charges > Misc. charges codes. Press CTRL+N to add a new code. In the Misc. charges code field, type a unique identifier for this miscellaneous charge. In the Description field, type a short description of the charge. Click the Item sales tax group arrow and select the sales tax group. Select the Intrastat check box if this miscellaneous charge must be considered in Intrastat transactions. Click the Posting tab.
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8. Determine who is responsible for the charge by using the information displayed in the following table. Expenses are added to Item Internal Vendor Paid Directly to creditor Internally Directly to creditor Internally Debit Type Item Item Ledger account Ledger account Customer/Vendor Credit Type Customer/Vendor Ledger account Customer/Vendor Ledger account Ledger account
EXAMPLE: If there are miscellaneous charges on an invoice from a vendor, the credit type is Customer/Vendor and the amount is posted to the vendor's summary account. If the miscellaneous charge has some other cause (for example freight or insurance) that the company (internally) receives and pays for separately, specify the Ledger account and Account credit type.
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Lab 11.3 - Create a Miscellaneous Charges Code

Contoso Entertainment Systems - Company CEU Scenario You are the Accounts payable coordinator at Contoso Entertainment Systems, and you must create a new Misc. charges code for transport charges that will be added to various items and paid to the vendor. Create a new charge for transportation fees with the following specifications: Name of the Misc. charges code: 09 Description: Transportation Fee
This fee does not require an Item sales tax group.
Challenge Yourself
Create a new charge for Transportation fees as specified in the scenario.
Need a Little Help?

1. The Misc. charges code form is located in Accounts payable >
Setup > Misc. charges > Misc. charges codes.
2. On the Posting tab, indicate the item debit information and the vendor credit information.
Step by Step
1.
2. 3. 4. 5. 6. 7.
Open Accounts payable > Setup > Misc. charges > Misc. charges codes. Press CTRL+N to add a new line. In the Misc. charges code field, enter Transport. In the Description field, enter Transportation Fee. Click the Posting tab. In the Debit type field, select Item. In the Credit type field, select Customer/Vendor.
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Manual Miscellaneous Charges

When creating a Sales or Purchase order, you can add miscellaneous charges to the order header and/or the order lines. Typically, you can manually add miscellaneous charges to a sales or Purchase order when the charges apply only to the specific order. For example, a customer calls and requests a large order. Because this is not a common order for the customer, the order taker adds the charges directly to the Sales order instead of setting up miscellaneous charges for the item.
Purchase Order Invoice

When you create a Purchase order invoice, miscellaneous charges can be added or modified on the invoice header and/or the invoice lines. You usually add or modify miscellaneous charges on a Purchase order invoice when the charges on the invoice from the supplier are different than what was on the Purchase order, or when additional charges were added to the invoice. Example You have created a Purchase order for an item. A miscellaneous charge on the order reflects that shipping costs are expected to be 50 U.S. Dollars (USD). Production losses in your company cause an inventory shortage and you call the vendor to ask them to use expedited shipping. When the invoice arrives from the vendor, the shipping costs are 75 USD. You can modify the invoice miscellaneous charge to reflect the correct charge. Notice that the difference between the 50 USD on the purchase order and the 75 USD on the invoice are visible in the Invoice matching form. Compared miscellaneous charges will be 75 USD. In the Compare misc. charges values form, the Invoice calculated value will be 75 USD, the Purchase order calculated value will be 50 USD.
Sales Orders
You can manually add miscellaneous charges to the Sales order header, the individual Sales order lines, or both. This is helpful when an order contains many different types of items that require different types of charges. The charges can be added to: The header: When an overall charge must be added to the order. The individual lines: When only certain lines on a multiple line order have miscellaneous charges. Both the header and the individual lines: When charges are added to the whole order but additional miscellaneous charges are required on individual lines. For example, when certain items on a multiple line order require special handling and therefore additional charges.
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Set up manual miscellaneous charges in the Misc. charges transactions form and access the charges from: The Sales order header by clicking the Setup button in the upper part of the form, and then selecting Misc. charges. The sales order lines by highlighting a line and selecting the Setup button in the lower part of the form, and then selecting Misc. charges.
Misc. Charges Transactions Form

The Misc. charges transactions form contains fields, which are described in the table. Field Misc. charges codes Description Select a Misc. charges code that is set up in the Accounts receivable and Accounts payable modules from Setup > Misc. charges > Misc. charges codes. The Transaction text field is automatically populated with the description of the Misc. charges code. This text is shown in the posted charge transaction and can be edited before posting. Miscellaneous charges on sales or Purchase order lines can be calculated as fixed charges, a charge for each unit, or a percentage of the line amount. The Intercompany category is used to set up miscellaneous charges for intercompany trade. Enter the value for the specified charge. The value can be a fixed amount, a percentage of the order or line total, or a fixed amount per unit depending on what is selected in the Category field. The Currency field is inherited from the selected Misc. charges code. Select the Keep check box to indicate that the miscellaneous charges transactions must be retained after partial invoicing.
Transaction text
Category
Misc. charges value
Currency Keep
Procedure: Manually Add Miscellaneous Charges to a Sales Order

To manually add miscellaneous charges to both the Sales order header and lines, follow these steps: 1. Click Accounts receivable > Sales Order Details. 2. Create a new Sales order (header and lines) in the Advanced view. 3. Select the Sales order header and then click Setup > Misc. Charges.
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4. Select a Misc. charges code in the Miscellaneous charges code field. 5. Click the Category arrow and select a category.
NOTE: The Category options, Pcs. and Intercompany percent, are available only in the order lines.
6. In the Misc. charges value field, enter the value for the specified charge category. 7. Select the Keep check box and then close the form. 8. Select the Sales order line, click Setup > Misc. charges. 9. Click the Miscellaneous charges code arrow and select a code. 10. Change the text in the Transaction text field if it is necessary. 11. Specify the Category. 12. In the Misc. charges value field, enter the value for the specified charge category. 13. Select the Keep check box to keep charges after partial invoicing and close the Misc. charges transactions form. 14. To view the total miscellaneous charges for the order, in the header, click Inquiries > Totals. The Total misc. charges field displays the total charges for the order.
NOTE: Miscellaneous charges on the header and line are included in the price. This means they are not specified on any of the posting updates.
Purchase Orders
The process for the manual setup of a miscellaneous charge for a Purchase order resembles the setup for a Sales order. However, for Purchase orders, the header miscellaneous charges can be allocated to the lines.
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Typically, you will allocate miscellaneous charges to the lines when the cost must be allocated to each line item in a Purchase order. When you add miscellaneous charges to the Purchase order header, determine how the charges are to be allocated to the lines by clicking the Setup button in the header and selecting Allocation.
FIGURE 11.4 ALLOCATE MISC. CHARGES FORM
Allocate Misc. Charges Form

Set up the method by which the misc. charges must be allocated in the Allocate misc. charges form. Open the form from the Purchase order header by clicking Setup > Allocation. The methods that are available in the Allocate misc. charges form are shown in the following table. Method Misc. charges allocation Description If the charge is a fixed amount, you determine the method for dividing miscellaneous charges: Net amount: The amount is allocated according to the line's net amount. Quantity: The amount is allocated according to the quantity of units on the lines. Per line: The amount is equally allocated among all lines.
Allocate misc. charges to lines
Identify the lines to which the miscellaneous charges are to be allocated: All lines: Allocate to all lines Positive lines: Allocate to lines with a positive quantity Negative lines: Allocate to lines with a negative quantity
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Method Allocate all
Description If you select the Allocate all check box, the miscellaneous charges allocation will be made to all miscellaneous charges, regardless of the Debit Type specified in the Misc. charges code setup. If it is cleared, only those with a Debit type of Item are allocated. Select Received to only allocate charges to received order lines.
Received
NOTE: If a header miscellaneous charge is added to the order and the Debit Type is Item in the selected Misc. charges code, the charge must be allocated to the lines before you can create an invoice.
Procedure: Allocate Miscellaneous Charges to Purchase Order Lines

To allocate miscellaneous charges to Purchase order lines, follow these steps. Click Accounts payable > Purchase order. 2. Click Advanced to see the complete form. 3. In the order header pane, click the Setup button and select Allocation to allocate the charges to the Purchase order lines. 4. Select the allocation method from the Misc. charges allocation list.
1. NOTE: This step applies only if the charge is a fixed amount.
5. In the Allocate misc. charges to lines field, specify whether to allocate charges to All lines, Positive lines, or Negative lines. 6. Select the Allocate all check box to allocate charges to Purchase order lines, even if the miscellaneous charge code has the debit type other than Item. 7. Select the Received check box to allocate charges only to received order lines.
NOTE: Charges are allocated to all lines based on the criteria that you selected. To allocate charges to selected lines, define the miscellaneous charges manually for each line.
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Lab 11.4 - Manual Setup of Miscellaneous Charges

Contoso Entertainment Systems - Company CEU Scenario Part 1: The Kingbird Wholesales customer (Customer account 1204) orders 250, Lamps for video projector model 02 (1508) and 20 Standard DVD player - black (1701). Because of the large order, a 150 U.S. dollars (USD) freight charge is added to the complete order. In addition, the bulbs require a special freight fee of 25 USD. As the order processor, you create the Sales order, adding the overall 150 USD charge and the special freight fee of 25 USD to the Purchase order line. Part 2: You are now the purchasing agent and have been informed that the stock is now low on the lamps, 1508. You call your regular supplier but they are outof-stock. You call the recommended supplier, Opal Electronics (Vendor account 1203), and they have lots of stock. Create a Purchase order for 50 items of 1508, and because there is a special on Item 1507, you order for 25 of those also. You are informed of the 200 USD freight charge. Allocate this amount by the quantity on the lines.
Challenge Yourself!
Create the Sales order as specified in part 1 of the scenario, adding the overall 150 USD charge and the special freight fee of 25 USD to the Purchase order line. Verify the amounts in the Totals form. Create a Purchase order for 50 items of 1508, and for 20 items of 1507. Allocate the 200 USD freight charge by the quantity on the lines.
Need a Little Help?

1. Create the sales order as specified in part 1 of the scenario. To set up both the overall charge and the special freight on the sales order, click Setup > Misc. charges on the sales order header. 2. Set up of the special freight on the sales order line. Click Setup > Misc. charges on the sales order line. 3. The Totals form is accessed from the sales order header by clicking
Inquires > Totals.
4. To create a purchase order as specified in the scenario, create two lines, one for 50 items of 1508 and 20 items of 1507.
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Set up the 200 USD freight charge from the sales order header by clicking Setup > Misc. charges. 6. To allocate the 200 USD according to quantity locate the Allocate misc. charges form from the sales order header by clicking Setup >
5. Allocation.
Step by Step
Create the sales order and verify the amounts in the Totals form.
1.
2. 3. 4. 5. 6. 7. 8. 9.
10.
11. 12. 13. 14.

15.
16. 17. 18.
Click Accounts receivable > Sales Order Details. Press CTRL+N. Click Customer account 1204. Click OK. Click the Item number arrow, locate and select item 1508. In the Quantity field, type 250. Press CTRL+N. Click the Item number arrow, locate and select item 1701. In the Quantity field, type 20. In the header, click Setup > Misc. charges. Click the Misc. charges code arrow and select 01. In the Misc. charges value field, type 150. Close the Misc. charges transactions form. In the lines, select the line for item 1508. In the lines section, click Setup > Misc. charges. Click the Misc. charges code arrow and select 01. In the Misc. charges value field, type 25. In the header, click Inquires > Totals and verify the amount of 175.00 in the Total misc. charges field.
Create the purchase order and allocate the amount by quantity on the line.
1.
2. 3. 4. 5. 6. 7. 8. 9. 10.
11.
12.
Click Accounts payable > Purchase Order Details. Press CTRL+N. Click Vendor account 1023. Click Yes to transfer vendor information. Click OK. Click the Item number arrow, locate and select item 1508. In the Quantity field, type 50. Click in the lines and press CTRL+N. Click the Item number arrow, locate and select item 1507. In the Quantity field, type 20. In the header, click Setup > Misc. charges. Click the Misc. charges code arrow and select 01.
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13. In the Misc. charges value field, type 200. 14. Close the Misc. charges transactions form. 15. In the header, click Setup > Allocation. 16. Click the Misc. charges allocation arrow and click Quantity. 17. Select the Allocate all check box. 18. Verify the charge allocation on the first line by clicking Setup > Misc. charges in the lines section for each item. 19. Verify that the misc. charge for item 1508 is 142.86 (200 USD/70 pieces x 50 pieces), and the misc. charge for item 1507 is 57.14 (200 USD / 70 pieces x 20 pieces).
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Automatic Miscellaneous Charges

Set up Microsoft Dynamics AX 2009 to add miscellaneous charges automatically when you buy or sell an item. Before you set up and assign automatic misc. charges, you can create and set up Miscellaneous charges groups.
Miscellaneous Charges Groups

Miscellaneous charges groups are used for the automatic setup of miscellaneous charges. This is because they classify items, customers, or vendors into groups for which the same miscellaneous charges applies. The groups are available for selection on the Auto-misc. charges form, and when orders are then created for these groups, the charges are automatically calculated and applied to the order. There are three kinds of groups: Customer misc. charges Vendor misc. charges Item misc. charges
Miscellaneous charges groups are useful when: A company has charges that apply to certain customers or groups of customers. Vendors charge certain fees on all orders. One or more items are associated with one or more customers or vendors.
Set Up Miscellaneous Charges Groups

Miscellaneous charges groups are set up in the same manner for customers, vendors, and items, but on different forms. To access the specific form, follow these paths: Customer misc. charges groups form: Open Accounts receivable > Setup > Misc. charges > Customer misc. charges groups. Vendor misc. charges group form: Open Accounts payable >
Setup > Misc. charges > Vendor misc. charges groups.
Item misc. charges group form: Open Inventory management > Setup > Misc. charges > Item misc. charges groups.
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Procedure: Set Up a Miscellaneous Charges Group for Customers
To set up a miscellaneous charges group for a customer, follow these steps: 1. Open Accounts receivable > Setup > Misc. charges > Customer misc. charges groups. 2. Press CTRL+N to create a new misc. charges group. 3. In the Misc. charges group field, enter a unique identifier for the group. 4. In the Description field, type a short description of the charges group.
Assign Miscellaneous Charge Groups to Base Data

Now the Misc. charges group can be assigned to the specific base data: Item misc. charges groups can be assigned to specific items from the Items form. Customer misc. charges groups can be assigned to specific customers from the Customer form. Customer misc. charges groups can also be assigned a specific Sales order in the Sales order form. Vendor misc. charges groups can be assigned to specific vendors from the Vendors form. Vendor misc. charges groups can also be assigned a specific Purchase order in the Purchase order form.
Procedure: Assign Miscellaneous Charges Groups to Items

To assign miscellaneous charges groups to items, follow these steps:
1.
Open the Items form by clicking Inventory management > Item

details.
2. Select the item to which to assign miscellaneous charges groups and then click the References tab. 3. In the Purchase order and Sales order field groups, select the relevant misc. charges group in the Misc. charges group field.
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Procedure: Assign Miscellaneous Charges Groups to Customers and Vendors
To assign miscellaneous charges groups to customers and vendors, follow these steps:
1.
Open Accounts receivable > Customer Details or Accounts payable > Vendor Details.
2. Select the customer or vendor to assign miscellaneous charges groups to. 3. Click the Sales order tab on the Customer or the Purchase order tab on the Vendor. 4. Select the relevant misc. charges group in the Misc. charges group field.
Procedure : Assign Miscellaneous Charges Groups to Orders

To assign miscellaneous charges groups to orders, follow these steps: 1. 2. 3. 4. Open the Sales order or the Purchase order. Select the order to assign a miscellaneous charges group to. Click the Price/Discount tab on the order header. Select the relevant misc. charges group in the Misc. charges group field.
Set Up Automatic Miscellaneous Charges

You can specify automatic miscellaneous charges for: A specific customer account, a group of customers, or all customers. A specific vendor account, a group of vendors, or all vendors. A specific item, or group of items, or all items. A combination of the above. Miscellaneous charges can, for example, be added when a specific customer buys a specific item.
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Set up Auto-misc. charges codes for sales in the Accounts receivable module and for purchases in the Accounts payable module. For both setup areas, select
Setup > Misc. charges > Auto-misc. charges.
FIGURE 11.5 AUTO-MISC. CHARGES FORM - CUSTOMER
Select the Main or Line level at which the miscellaneous charges should be calculated, in the Level field.
Set Up Automatic Miscellaneous Charges - Overview Tab

The fields in the Overview tab of the Auto-misc. charges form are described in the following table. Fields Account code Main level Specifies whether the charge is to be calculated for a specific account (Table), a specific account group (Group), or for all accounts (All). If you select All, the remaining fields cannot be specified. Line level Refer to Main level.
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Fields Customer/ Vendor relation
Main level If the value in the Account code field is set to Table, specify the account number for which the charge has been created. If Group is selected in the Account code field, specify the customer or vendor charge group for which the charge has been created. If All is selected in the Account code field, the charge will be calculated on the order line, regardless of the item number selected. By default, this field is set to All. If you are on the Main level, this field cannot be changed.
Line level Refer to Main level.
Item code
Specify whether the charge is to be calculated for a specific item, a specific item group, or for all items. If the value in the Account code field is set to Table, specify the item number for which the charge has been created here. If the value is Group in the Account code field, specify the item misc. charge group for which the charge has been created. If All is selected in the Account code field, the purchase charge will be calculated on the Purchase order line, regardless of the item number selected.
Item relation
By default, this field is blank. If you are on the Main level, this field cannot be changed.
NOTE: The miscellaneous charges are applied according to the Microsoft Dynamics AX 2009 hierarchy, first being applied at the Table level, and then the Group level and, finally, the Items level.
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Set Up Automatic Miscellaneous Charges - Lines Tab
The fields on the Lines tab of the Auto misc. charges form are described in the following table. Fields Currency Misc. charges code Category Description Specify the currency code for the miscellaneous charges transaction. Select one of the charges defined in Misc. charges code form. Specify whether miscellaneous charges are to be calculated as one of these three options: A fixed amount per invoice An amount per piece As a percentage of the invoice amount
Fixed and percent can be used on charges in the order header and the order lines, whereas per piece can only be used on order lines. Misc. charges value Misc. charges currency code Specify the value for the specified category. The Currency field is inherited from the selected Misc. charges code. Specify the currency code for the charge if you want to use a different currency than specified in the sales/Purchase order. However, this is only possible if the debit/credit type is either Ledger account or Item for the selected Misc. charges code. Specify the tax group for the miscellaneous charges transaction. Select the Keep check box to indicate that miscellaneous charges transactions must remain after partial invoicing.
Sales tax group Keep
NOTE: The Misc. charges currency code must be the same as the default currency for the customer or vendor currency for the misc. charges to be allocated to the sales or Purchase order.
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Procedure: Activate Automatic Miscellaneous Charges
To ensure that automatic miscellaneous charges are appropriately handled, you must activate them in the Accounts receivable or Accounts payable parameter form. To activate automatic miscellaneous charges, follow these steps:
1.
Open Accounts receivable > Setup > Parameters or Accounts payable >
Setup > Parameters.
2. Click the Prices tab. 3. Select the Find main misc. charges and Find misc. charges for line check boxes. 4. Close the form.
Procedure: Edit Automatic Miscellaneous Charges

Occasionally, you must change miscellaneous charges on orders. For example, because of a problem with a previous purchase, the vendor has offered to waive the typical handling fee on the next order. To view, modify, or delete the automatic miscellaneous charges, follow these steps: 1. Open a sales or Purchase order. 2. Click Setup > Misc. charges for the order header or the order lines, depending on if the charges are allocated on the header or on the lines. 3. In the Misc. charges transactions form, modify the transaction. To delete an automatic miscellaneous charge line, select the line and then click the Delete icon on the Toolbar.
NOTE: You can modify or delete the Automatic Misc. Charges at any time through the posting process.
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Lab 11.5 - Create a Customer Miscellaneous Charges Group

Contoso Entertainment Systems - Company CEU Scenario Contoso Entertainment Systems is the largest supplier of item 1508, the lamps for video projector model 02, for customers 1204,Kingbird Wholesales, and 1302, Turtle Wholesales. Because of the large quantity and weight of items sold, Contoso Entertainment Systems and the two customers have agreed to a 15 percent freight charge for all orders. This charge represents a reduced fee because of the bulk purchases. As the Accounts receivable administrator, you have been asked to set up a new Customer misc. charges group and assign the code to the customers 1204 and 1302. The name of the new charge group is 06 and the Description is Freight 15%.
Challenge Yourself!
Set up a new Customer misc. charges group and assign the code to the customers 1204 and 1302.
NOTE: This group will be defined on the Auto-misc. charges form by the controller. You are only responsible for the new group and assigning it to the customer.
Need a Little Help?

1.
Set up a new Customer misc. charges group. The Customer misc. charges groups form is located in Accounts receivable > Setup > Misc.
charges > Customer misc. charges groups.
2. Create a new freight charge 06, with a description of Freight 15%. 3. Assign the misc. charges code to the customers. Do this by locating the customers 1204 and 1302 in the Customers form. Then add the new Customer misc. charges group to each customer on the Sales order tab.
Step by Step
Set up a customer misc. charges group
1.
Open Accounts receivable > Setup > Misc. charges > Customer misc. charges groups.
2. Press CTRL+N. 3. In the Misc. charges group field, enter 06.
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4. In the Description field, type Freight 15%. 5. Close the Customer misc. charges groups form. Assign the misc. charges group to customers
1.
2. 3. 4. 5. 6. 7.
Open Accounts receivable > Customers. Locate and select customer 1204, Kingbird Wholesales. Click the Sales order tab. Select 06 in the Misc. charges group field. Click the Overview tab. Locate customer 1302, Turtle Wholesales. Repeat steps 3 to 4.
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Lab 11.6 - Set Up of Automatic Miscellaneous Charges

Contoso Entertainment Systems - Company CEU Scenario The customer Otter Wholesales (Customer account 1304), purchases in small quantities from Contoso Entertainment Systems. Because of their purchase history, an agreement has been made that all orders now include a 15 U.S. dollar (USD) freight charge. As the accounting manager for Contoso Entertainment Systems, you must set up a new automatic miscellaneous charge for customer 1304. The Misc. charge code 01 is used for this freight charge.
NOTE: This Misc. charge code is set up to debit the customer and credit the miscellaneous charges ledger account 403500. This information is used at the end of this lab to verify posting.
Later, the purchaser for Otter Wholesales orders 45 of item 1702, the Standard DVD player - Silver. As the order processor for Contoso Entertainment Systems, you create the Sales order. The purchaser asks you to verify that the 15 USD freight charge is included in the order. You verify it in the header and then post the Sales order.
Challenge Yourself!
On the Auto-misc. charges form, add the 15 USD freight charge for customer 1304. 1. Create a Sales order to customer 1304 for 45 of item 1702. 2. Pick the sales order line, and post and review the Invoice for the freight charge. 3. After you post the Sales order, open the ledger transactions for account 403500 and verify that the miscellaneous charge was correctly posted to the account.
Need a Little Help?

1.
Add the 15 USD freight charge as an Auto-misc. charge for customer 1304. The Auto-misc. charges form is located in Accounts
Receivable > Setup > Misc. charges > Auto-misc. charges.
2. From the Accounts receivable module, open the Sales order form to create a new Sales order. 3. Click Inventory > Pick to pick the sales order line. 4. Click Posting > Invoice to post the invoice. 5. Open the Chart of accounts from the General ledger located in
General ledger > Chart of Account Details.
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Step by Step
Add freight charges for customer 1304 on to the Auto-misc. charges form:
1.
Open Accounts receivable > Setup > Misc. charges > Auto-misc. charges. In the Auto-misc. charges form, verify that the Level field = Main. Press CTRL+N. Select Table in the Account code field. Select 1304 in the Customer relation field. Click the Lines tab. Select 01 in the Misc. charges code field. Enter 15 in the Misc. charges value field. Close the Auto-misc. charges form.
2. 3. 4. 5. 6. 7. 8. 9.
Create a Sales order, post the invoice and review the freight charge
1.
2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14.
Open Accounts receivable > Sales Order Details. Press CTRL+N. Select Customer account 1304, and then click OK. Select item 1702 in the Item number field. In the Quantity field, type 45. Click Inventory > Pick on the sales order line. Select the Auto-create check box, and then click Post all. Close the Pick form. Post the Sales order by clicking Posting > Invoice. In the Parameters field group, select All in the Quantity field. Select the Print invoice check box and then click OK. Click Yes to the message about printing. The Invoice appears. Note the Invoice number and then scroll to the bottom to verify that the 15 USD miscellaneous charges appear. Close all the open forms.
Verify that the misc. charges were correctly posted to the account: Open General ledger > Chart of Account Details. 2. Locate and select Ledger account 403500 and then click Transactions. 3. Locate the invoice number noted in step 13 and verify that the 15 USD charge is posted to the account.
1.
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Landed Cost Miscellaneous Charges

A landed cost enables a company to capture all the costs related to an inventory item. Calculating landed cost is valuable when the additional costs are a significant part of the item cost. Determining landed costs is also helpful when you compare item costs between vendors. For example, vendor A sells an item for 4.75 U.S. dollars (USD) and vendor B sells the item for 4.25 USD. However, vendor B charges more in freight charges so that the complete cost of the item is more than vendor A's cost. In Microsoft Dynamics AX 2009, landed costs can be added when an item is posted and will provide the item's total cost. Third-party charges, such as freight and import duty, can be posted to an item so that the item transactions include these charges. This process provides a landed cost for the item. You can add these additional charges at following points in time: Before the order is posted, if known. Later, if the charges come in after posting.
Adding Landed Cost Misc. Charges after Invoice Update

In Microsoft Dynamics AX 2009, miscellaneous charges can be added to a Purchase order until it is invoiced. If an invoice from the vendor contains a miscellaneous charge, it must be added and allocated among the items before or during invoicing. However, in some cases, a company might receive a bill from a third-party at a later stage. To adjust the cost price for the items, you must set up the Misc. charges code as a Debit to the Item and a Credit to the Ledger account.
Procedure - Adjust Miscellaneous Charges using a Journal

To make an adjustment on an invoice from the Invoice Journal form, follow these steps: 1. Open Accounts payable > Inquiries > Journals > Invoice. 2. On the Invoice Journal form, select the invoice to adjust. 3. Click Misc. charges > Adjustment; the Allocate misc. charges form appears. 4. If the miscellaneous charge is for a fixed amount, select the allocation method in the Misc. charges allocation field. 5. In the Posting date field, enter the date of posting in the ledger. 6. Click the Allocate misc. charges to lines arrow and decide how to allocate charges to the lines. 7. Click the Misc. charges code arrow and select the relevant code.
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8. 9. 10. 11. 12. Update the Transaction text, if necessary. In the Misc. charges value field, enter a value. Click the Category arrow and select how to calculate the charge. Click OK to adjust the charges to the lines. To view the adjustment to the lines, click the Lines tab of the adjusted invoice and then click Misc. charges. Each line will display the charges as allocated in steps 4-11.
Adjust Miscellaneous Charges on a Purchase Order

Make adjustments on an invoiced order directly from the Purchase order form. For example, a freight bill is received from a third-party vendor after the original Purchase order was received and invoiced. The charge can still be allocated to the items received on the original Purchase order through the adjustment process. Purchase order adjustments use the same process as the Invoice journal. To access the Allocate misc. charges form for the Purchase order, follow these steps:
1.
Open the Purchase order that requires the adjustment and then visit
Inquiries > Invoice> Misc. charges > Adjustment.
2. Follow the steps 4-12 of the Procedure: Adjust Miscellaneous Charges on a Purchase Order.
NOTE: Ensure that the miscellaneous charge debits the item and credits the appropriate ledger account or it will not appear in the Misc. charges transactions form.
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Lab 11.7 - Add Landed Costs to an Invoice Journal

Contoso Entertainment Systems - Company CEU Scenario You receive a freight bill for an order that was already invoiced. The insurance required to ship the items was significantly greater than expected. Therefore, you must add the cost and allocate it to the items as a landed cost. As the accounts payable coordinator, add 500 U.S. dollars (USD) to the posted invoice 2414 (Purchase order number 000005) in the Invoice Journal by using the Misc. charges code 04, Other miscellaneous charges.
Challenge Yourself!
Add 500 USD to the posted invoice 2414 (Purchase order number 000005) in the Invoice Journal by using the Misc. charges code 04. Allocate the insurance charge to the line's net amount. After you post the adjustment, verify the allocations on the lines and then verify that the charge posted to the Prepaid insurance account (600150). This ledger account is specified on the Misc. charges code 04. Verify the allocation to the lines and the posting to the Prepaid insurance account.
Need a Little Help?

1.
Add 500 USD to the posted invoice 2414 (Purchase order number 000005) in the Invoice Journal form located in Accounts Payable >
Inquiries > Journals > Invoice journal.
2. Locate and select Invoice number 2414 and open the Allocate misc. charges form. Select the Insurance charge code 04 and then add the 500 USD fee. 3. On the Lines tab, verify the allocation of each line on the adjusted invoice. 4. Open the Chart of accounts from the General ledger located in General ledger > Chart of accounts details. Verify that the 500 USD charge appears for Ledger account 600150.
Step by Step
Locate the invoice 2414 and adjust: Open Accounts payable > Inquiries > Journals > Invoice. 2. Locate and select Invoice number 2414.
1.
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3.
4. 5. 6. 7. 8. 9. 10. 11.
Click Misc. charges > Adjustment. Select 04 in the Misc. charges code field. In the Misc. charges value field, type 500. Click OK. To view the adjustment to the lines, on the Invoice Journal form, with the adjusted invoice line selected, click the Lines tab. On the first line, click Misc. charges to view the charge allocation for the line. Close the Misc. charges transactions form. On the second line, click Misc. charges to view the charge allocation for the line. Close all open forms.
Verify that the charge appears for Ledger account 600150: Open General ledger > Chart of accounts details. 2. Locate and select Ledger account 600150 and then click Transactions. 3. Verify that the 500 USD charge is posted to the account.
1.
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Add Miscellaneous Charges to a Purchase Order Invoice

Add or change miscellaneous charges during the Purchase order invoicing process with Microsoft Dynamics AX 2009. You can apply the miscellaneous charges to the invoice header or the invoice lines. Additionally, you can connect the transactions to the Purchase order header or lines so that you can find and correct differences, if necessary. For each customer/vendor miscellaneous charge code, determine whether you want to compare miscellaneous charges values on Purchase orders and invoices. Example If a miscellaneous charge on an invoice differs from the expected miscellaneous charge on the corresponding Purchase order, you can change the miscellaneous charge transaction for the invoice. For example, a miscellaneous charges transaction for a handling fee might be 10.00 USD on the Purchase order, but when the invoice arrives, the handling fee may have increased to 20.00 USD.
Account for Purchase Order Invoice Variance Caused by Miscellaneous Charges

If the miscellaneous charges for an invoice differ from the miscellaneous charges for the Purchase orders, you can change the miscellaneous charges for the unposted invoice. Miscellaneous charges are copied to an unposted invoice from the applicable Purchase orders. Purchase order miscellaneous charges transactions that are copied to an invoice are not copied to later invoices for the same Purchase orders, except for any miscellaneous charges transactions that have the Keep check box selected in the Misc. charges transactions form.
NOTE: Miscellaneous charges values for an invoice are not included in the price tolerance calculations for accounts payable invoice matching. However, you can view expected and actual values for Customer/Vendor type miscellaneous charge codes in the Compare misc. charges values - Invoice form.
When you post a Purchase order invoice, the system posts the miscellaneous charges transactions from the invoice. The system removes corresponding miscellaneous charges transactions from the Purchase order, except for any miscellaneous charges transactions that have the Keep check box selected in the Misc. charges transactions form.
NOTE: If you are working with an invoice for an intercompany Purchase order, you cannot change miscellaneous charges on the invoice. The miscellaneous charges for the intercompany Purchase order must match the miscellaneous charges for the corresponding intercompany Sales order, and any changes to miscellaneous charges for the invoice for the Purchase order will cause posting to fail.
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Procedure: Add Miscellaneous Charges to a Purchase Order
To add miscellaneous charges to a Purchase order, follow these steps: Click Accounts payable > Purchase Order Details. 2. Select a Purchase order and then click Posting > Invoice. 3. Select which miscellaneous charges transactions to add, change, or delete: a. To add, change, or delete miscellaneous charges transactions for the invoice header, click Setup > Misc. charges on the Overview tab. b. To add, change, or delete miscellaneous charges transactions for an invoice line, click the Lines tab and then click Misc. charges. c. To add, change, or delete miscellaneous charges for the invoice header for a summary invoice that is selected on the Overview tab, click the Purchases tab and then click Setup > Misc. charges.
1.
4. In the Misc. charges transactions form, enter the miscellaneous charge from the invoice that you received from your vendor. 5. Click to Connect the selected miscellaneous charges transaction for an invoice header or line to the corresponding Purchase order header or line. Close the form. 6. Close the Misc. charges transactions form.
Procedure: Invoice Match the Miscellaneous Charge

To invoice match the miscellaneous charge that was added to the Purchase order, follow these steps: 1. In the Posting invoice form, click Matching details. 2. In the Invoice matching details form, click the Compared misc. charges button. 3. In the Compare misc. charges values - Invoice form, compare information about Customer/Vendor type miscellaneous charges for the Purchase order and invoice. The comparison includes only miscellaneous charges codes that have the Compare Purchase order and invoice values check box selected in the Misc. charges code form.
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Update of Miscellaneous Charges and Allocation
If a miscellaneous charges transaction was added to Purchase order lines and the miscellaneous charges amount is different on the invoice, you can enter a new miscellaneous charge transaction for the difference and then allocate it to the invoice lines.
NOTE: If you are working with an invoice that has been summarized and you add a miscellaneous charge to the summary invoice header (on the Overview tab), allocation affects all invoice lines that are included in the summary invoice. If you add a miscellaneous charge to one of the individual invoice headers (on the Purchases tab), allocation affects only the invoice lines that are associated with the selected invoice header.
For example, assume that a miscellaneous charge for freight was expected to be 20.00 U.S. dollars (USD) and was allocated equally to four Purchase order lines. If the freight charge on the invoice is 30.00 USD, enter an additional miscellaneous charge transaction for the invoice header and allocate it to the four invoice lines. The additional miscellaneous charge amount is allocated only to the invoice lines. The Purchase order lines are not affected.
Procedure: Allocate Miscellaneous Charges

To allocate miscellaneous charges, follow these steps:
1. 2.
3. 4. 5.
6.
7.
8.
Click Accounts payable > Purchase Order Details. Select a Purchase order and then click Posting > Invoice. Enter or select an invoice. To add miscellaneous charges transactions to the invoice header, click Setup > Misc. charges on the Overview tab. In the Misc. charges transactions form, enter the miscellaneous charge from the invoice that you received from your vendor. In this example, enter 10.00, because that is the difference between the Purchase order miscellaneous charge and the invoice miscellaneous charge. Close the Misc. charges transactions form. In the Posting invoice form, click Setup > Allocation. Select how to allocate the miscellaneous charge to the lines. For this example, select Per line to allocate the charges equally to all four lines on the invoice.
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Summary
Over/Under delivery is an effective way to manage small differences between ordered and received or delivered quantities in Microsoft Dynamics AX 2009. Miscellaneous Charges helps companies to: Add additional costs to sales and purchases such as freight, transport, postage, insurance, packaging, and fees. Eliminate data entry by: o o Allocating charges to items Setting up and using automatic miscellaneous charges
Set up and use manual miscellaneous charges on sales and Purchase orders. Include landed costs in an item's total cost with the following methods: o o On an Invoice Journal On the Purchase order
Add miscellaneous charges to a Purchase order invoice and allocate to the Purchase order lines.
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2.
3.
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MICROSOFT DYNAMICS AX 2009
COURSE 80024: TRADE AND LOGISTICS I
Last Revision: June 2008 The information contained in this document represents the current view of Microsoft Corporation on the issues discussed as of the date of publication. Because Microsoft must respond to changing market conditions, it should not be interpreted to be a commitment on the part of Microsoft, and Microsoft cannot guarantee the accuracy of any information presented after the date of publication. This document is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS DOCUMENT. Complying with all applicable copyright laws is the responsibility of the user. Without limiting the rights under copyright, no part of this document may be reproduced, stored in or introduced into a retrieval system, or transmitted in any form or by any means (electronic, mechanical, photocopying, recording, or otherwise), or for any purpose, without the express written permission of Microsoft Corporation. Microsoft may have patents, patent applications, trademarks, copyrights, or other intellectual property rights covering subject matter in this document. Except as expressly provided in any written license agreement from Microsoft, the furnishing of this document does not give you any license to these patents, trademarks, copyrights, or other intellectual property.
2008 Microsoft Corporation. All rights reserved. Microsoft Dynamics, AX 2009 are either trademarks or registered trademarks of Microsoft Corporation or Great Plains Software, Inc. or their affiliates in the United States and/or other countries. Great Plains Software, Inc. is a subsidiary of Microsoft Corporation. The names of actual companies and products mentioned herein may be the trademarks of their respective owners.
This course content is designed for Microsoft Dynamics 2009 formerly a part of Microsoft Business Solutions.
Table of Contents Introduction 0-1
Welcome ............................................................................................................ 0-1 Microsoft Dynamics Courseware Contents ........................................................ 0-2 Documentation Conventions .............................................................................. 0-3 Student Objectives ............................................................................................. 0-4
1-1
Objectives ........................................................................................................... 1-1 Introduction ......................................................................................................... 1-1 Logistics and Inventory Management ................................................................. 1-2 Logistics and Inventory Features........................................................................ 1-2 Information Flow ................................................................................................. 1-6 Summary ............................................................................................................ 1-6 Quick Interaction: Lessons Learned ................................................................... 1-7
2-1
Objectives ........................................................................................................... 2-1 Introduction ......................................................................................................... 2-1 Item Groups ........................................................................................................ 2-2 Lab 2.1 - Locating Inventory Posting Accounts ................................................ 2-14 Inventory Model Groups ................................................................................... 2-16 Lab 2.2 - Set Up an Inventory Model Group and Apply It to an Item ................ 2-24 Dimension Groups ............................................................................................ 2-27 The Inventory Dimensions Form ...................................................................... 2-30 Item Dimension Combinations.......................................................................... 2-37 Lab 2.3 - Create an Inventory Dimension Group .............................................. 2-41 Inventory Parameters ....................................................................................... 2-43 Item Setup ........................................................................................................ 2-44 Default Order Settings ...................................................................................... 2-56 Units of Measure .............................................................................................. 2-60 Warehouse Management ................................................................................. 2-62 Lab 2.4 - Create a New Item ............................................................................ 2-64 Item Pricing ...................................................................................................... 2-68 Summary .......................................................................................................... 2-75 Test Your Knowledge ....................................................................................... 2-76 Quick Interaction: Lessons Learned ................................................................. 2-79
3-1
Objectives ........................................................................................................... 3-1 Introduction ......................................................................................................... 3-1 Working with Purchase Orders ........................................................................... 3-2 Purchase Order Types ..................................................................................... 3-15 Lab 3.1 - Create Purchase Orders ................................................................... 3-20 Set Up Accounts Payable Purchase Parameters ............................................. 3-23 Lab 3.2 - Applying Purchase Parameters ......................................................... 3-25 Ship to Multiple Addresses ............................................................................... 3-27 Lab 3.3 - Ship to Multiple Addresses and Purchase Orders............................. 3-29 Purchase Order Posting ................................................................................... 3-31 Post a Purchase Order ..................................................................................... 3-32

Post a Receipts List .......................................................................................... 3-41 Post a Packing Slip .......................................................................................... 3-43 Post a Purchase Order Invoice ........................................................................ 3-47 Lab 3.4 - Post a Purchase Order ...................................................................... 3-54 Accounts Payable Invoice Matching ................................................................. 3-56 Purchase Order Financial Posting .................................................................... 3-66 Purchase Order Discount Posting .................................................................... 3-69 Summary .......................................................................................................... 3-71 Test Your Knowledge ....................................................................................... 3-72 Quick Interaction: Lessons Learned ................................................................. 3-75
4-1
Objectives ........................................................................................................... 4-1 Introduction ......................................................................................................... 4-1 Dimension Group - Storage Dimensions ............................................................ 4-2 Manual Allocation ............................................................................................... 4-3 Lab 4.1 - Set Up an Item with Manual Allocation of Serial Numbers ................ 4-11 Automatic Allocation ......................................................................................... 4-13 Lab 4.2 - Set Up an Automatically Allocated Serialized Item ........................... 4-18 Tracing ............................................................................................................. 4-21 Lab 4.3 - Trace Items ....................................................................................... 4-26 Summary .......................................................................................................... 4-27 Quick Interaction: Lessons Learned ................................................................. 4-28
5-1
Objectives ........................................................................................................... 5-1 Introduction ......................................................................................................... 5-1 Item Registration Setup ...................................................................................... 5-2 Item Arrival ......................................................................................................... 5-3 Lab 5.1 - Manage an Item Arrival ..................................................................... 5-11 Summary .......................................................................................................... 5-13 Test Your Knowledge ....................................................................................... 5-14 Quick Interaction: Lessons Learned ................................................................. 5-15 Solutions ........................................................................................................... 5-16
6-1
Objectives ........................................................................................................... 6-1 Introduction ......................................................................................................... 6-1 Quarantine Warehouse Setup Parameters ........................................................ 6-2 Lab 6.1 - Create Quarantine Inventory ............................................................... 6-6 Quarantine Item Management ............................................................................ 6-9 Lab 6.2 - Purchase to Quarantine Inventory..................................................... 6-16 Inventory Transactions on Quarantined Items.................................................. 6-18 Summary .......................................................................................................... 6-19 Test Your Knowledge ....................................................................................... 6-20 Quick Interaction: Lessons Learned ................................................................. 6-21 Solutions ........................................................................................................... 6-22
7-1
Objectives ........................................................................................................... 7-1
ii
Table of Contents
Introduction ......................................................................................................... 7-1 Create Vendor Returns ...................................................................................... 7-2 Create Vendor Returns for Serialized Items ....................................................... 7-6 Lab 7.1 - Working with Vendor Returns............................................................ 7-10 Lab 7.2 - Complete a Vendor Return Using Returned Order Type .................. 7-11 Summary .......................................................................................................... 7-13 Quick Interaction: Lessons Learned ................................................................. 7-14
8-1
Objectives ........................................................................................................... 8-1 Introduction ......................................................................................................... 8-1 Working with Sales Orders ................................................................................. 8-2 Sales Order Types ............................................................................................. 8-4 Lab 8.1 - Create a Sales Order .......................................................................... 8-6 Sales Parameters ............................................................................................... 8-7 Lab 8.2 - Apply Sales Parameters ...................................................................... 8-8 Ship to Multiple Addresses ................................................................................. 8-9 Enhanced Delivery Date Control ...................................................................... 8-11 Lab 8.3 - Set Up Transport Times .................................................................... 8-20 Available Ship and Receipt Dates .................................................................... 8-22 Lab 8.4 - Available Dates and Delivery Dates .................................................. 8-25 Order Entry Deadlines ...................................................................................... 8-26 Create a Sales Order in a Multi Time Zone Environment ................................. 8-30 Direct Delivery .................................................................................................. 8-32 Lab 8.5 - Direct Delivery ................................................................................... 8-38 Sales Order Posting ......................................................................................... 8-40 Post a Sales Order Confirmation ...................................................................... 8-41 Post a Sales Order Picking List ........................................................................ 8-47 Post a Picking List Registration ........................................................................ 8-49 Post a Sales Order Packing Slip ...................................................................... 8-50 Post a Sales Order Invoice ............................................................................... 8-53 Lab 8.6 - Post a Sales Order ............................................................................ 8-55 Post an Invoice Based on Packing Slips .......................................................... 8-58 Sales Order Financial Posting .......................................................................... 8-61 Multisite ............................................................................................................ 8-66 Shipping Carrier Interface ................................................................................ 8-71 Summary .......................................................................................................... 8-73 Test Your Knowledge ....................................................................................... 8-74 Quick Interaction: Lessons Learned ................................................................. 8-76 Solutions ........................................................................................................... 8-77
9-1
Objectives ........................................................................................................... 9-1 Introduction ......................................................................................................... 9-1 Item Pick Registration Setup .............................................................................. 9-2 Automatic Registration of a Pick......................................................................... 9-7 Manual Registration of a Pick ............................................................................. 9-8 Item Pick Registration of Serialized and Batch Inventory ................................... 9-9 Lab 9.1 - Item Picking Registration of Serialized Inventory .............................. 9-11 Edit, Reverse, and Split a Pick ......................................................................... 9-13
iii

Lab 9.2 - Edit, Reverse, and Split a Pick .......................................................... 9-16 Release Sales Order Picking ........................................................................... 9-18 Summary .......................................................................................................... 9-26 Quick Interaction: Lessons Learned ................................................................. 9-27
10-1
Objectives ......................................................................................................... 10-1 Introduction ....................................................................................................... 10-1 Scenarios: Customer Returns .......................................................................... 10-2 Set Up Customer Returns ................................................................................ 10-4 Create a Return Order ...................................................................................... 10-9 Lab 10.1 - Create a Return Order .................................................................. 10-13 Item Arrival and Receipt Registration ............................................................. 10-15 Lab 10.2 - Process a Return Order ................................................................ 10-20 Lab 10.3 - Post the Packing Slip and Invoice ................................................. 10-22 Quarantine Orders .......................................................................................... 10-23 Replacement Orders ...................................................................................... 10-24 Reports and Statistics .................................................................................... 10-25 Summary ........................................................................................................ 10-27 Test Your Knowledge ..................................................................................... 10-28 Quick Interaction: Lessons Learned ............................................................... 10-29 Solutions ......................................................................................................... 10-30
11-1
Objectives ......................................................................................................... 11-1 Introduction ....................................................................................................... 11-1 Over/Under Delivery ......................................................................................... 11-2 Lab 11.1 - Use Over/Under Delivery with Purchase Orders ............................. 11-8 Lab 11.2 - Use Underdelivery with Sales ....................................................... 11-10 Miscellaneous Charges .................................................................................. 11-12 Price Miscellaneous Charges ......................................................................... 11-13 Miscellaneous Charges Codes ....................................................................... 11-15 Lab 11.3 - Create a Miscellaneous Charges Code......................................... 11-20 Manual Miscellaneous Charges ..................................................................... 11-21 Lab 11.4 - Manual Setup of Miscellaneous Charges ...................................... 11-26 Automatic Miscellaneous Charges ................................................................. 11-29 Lab 11.5 - Create a Customer Miscellaneous Charges Group....................... 11-36 Lab 11.6 - Set Up of Automatic Miscellaneous Charges ................................ 11-38 Landed Cost Miscellaneous Charges ............................................................. 11-40 Lab 11.7 - Add Landed Costs to an Invoice Journal....................................... 11-42 Add Miscellaneous Charges to a Purchase Order Invoice ............................. 11-44 Summary ........................................................................................................ 11-47 Quick Interaction: Lessons Learned ............................................................... 11-48
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Introduction

Microsoft Dynamics Courseware

Trade and Logistics I in Microsoft Dynamics AX 2009

Microsoft Dynamics Courseware Contents

Need a Little Help?

Quick Interaction: Lessons Learned

Trade and Logistics I in Microsoft Dynamics AX 2009

Chapter 1: Introduction to Trade and Logistics

CHAPTER 1: INTRODUCTION TO TRADE AND LOGISTICS

Trade and Logistics I in Microsoft Dynamics AX 2009

Logistics and Inventory Management

Logistics and Inventory Features

Chapter 1: Introduction to Trade and Logistics

Trade and Logistics I in Microsoft Dynamics AX 2009

Chapter 1: Introduction to Trade and Logistics

Trade and Logistics I in Microsoft Dynamics AX 2009

Chapter 1: Introduction to Trade and Logistics

Quick Interaction: Lessons Learned

Trade and Logistics I in Microsoft Dynamics AX 2009

Trade and Logistics I in Microsoft Dynamics AX 2009

FIGURE 2.1 ITEM GROUP FORM - OVERVIEW TAB

Sales Order Tab

FIGURE 2.2 ITEM GROUP FORM - SALES ORDER TAB

Trade and Logistics I in Microsoft Dynamics AX 2009

Sales Order Tab - Packing Slip Field Group

Sales Order Tab - Invoice Field Group

Sales Order Tab - Commission Field Group

Sales Order Tab - Sales Tax Field Group

Trade and Logistics I in Microsoft Dynamics AX 2009

FIGURE 2.3 ITEM GROUP FORM - PURCHASE ORDER TAB

Purchase Order Tab - Packing Slip Field Group

Purchase Order Tab - Invoice Field Group

Trade and Logistics I in Microsoft Dynamics AX 2009

Purchase Order Tab - Fixed Receipt Price Field Group

FIGURE 2.4 ITEM GROUP FORM - INVENTORY TAB

Inventory Tab - Inventory Field Group

Trade and Logistics I in Microsoft Dynamics AX 2009

Inventory Tab - Fixed Receipt Price

Inventory Tab - Fixed Assets and Variances Field Groups

FIGURE 2.5 ITEM GROUP FORM - PRODUCTION TAB

Production Tab - Items in Process Field Group

Trade and Logistics I in Microsoft Dynamics AX 2009

FIGURE 2.6 ITEM GROUP FORM - SETUP TAB

Trade and Logistics I in Microsoft Dynamics AX 2009

Lab 2.1 - Locating Inventory Posting Accounts

Need a Little Help?

Trade and Logistics I in Microsoft Dynamics AX 2009

Inventory Model Groups

FIGURE 2.7 INVENTORY MODEL GROUPS FORM

FIGURE 2.8 INVENTORY MODEL GROUPS FORM - SETUP TAB

Trade and Logistics I in Microsoft Dynamics AX 2009

Setup Tab - Negative Inventory Field Group

Setup Tab - Physical Negative Inventory

Examples - Financial Negative Inventory

Trade and Logistics I in Microsoft Dynamics AX 2009

Setup Tab - Post Physical Inventory

Setup Tab - Post Financial Inventory

Selection status Clear

Setup Tab - Post Physical Revenue and Post Physical Purchase

Setup Tab - Physical Update Field Group

Setup Tab - Registration Requirements

Trade and Logistics I in Microsoft Dynamics AX 2009

Setup Tab - Receiving Requirements

Setup Tab - Reservation Field Group

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