Dynamics 365 Business Central – Some Considerations when Changing Standard Cost on an Item Card
Changing standard cost directly on an item card in Business Central has two critical side effects: stock keeping units are not automatically updated, and existing inventory is not revalued. Understanding these considerations is essential before making cost changes to avoid unexpected cost adjustments during sales transactions.
"The system doesn't update the standard cost of any Stock Keeping Units."
Key points
- Updating standard cost on the item card does not automatically update standard costs on related stock keeping units for specific locations
- Existing on-hand inventory retains its original cost and is not revalued when you change the standard cost
- When you sell items after a cost change, the system initially uses the new cost but cost adjustment reverts it to the original cost based on value entries
- The Standard Cost Worksheet is the proper tool to use if you need to revalue existing inventory
- Automatic cost adjustment must be set to ‘Always’ or you must manually run ‘Adjust Cost - Item Entries’ to see cost adjustments
Quotes
- “The system doesn’t update the standard cost of any Stock Keeping Units.” (This is a critical gotcha when changing costs on the item card with location-specific SKUs, requiring manual updates to avoid posting at incorrect costs)
- “Existing on-hand inventory is not revalued when you change the Standard Cost on the Item Card.” (This explains why sold items revert to original costs through adjustment, a common source of confusion in standard costing implementations)
- “If you need your on-hand stock revalued to the new cost, the Standard Cost Worksheet is the tool for the job.” (Provides the correct procedural guidance for users who need to actually revalue existing inventory rather than just change the cost)
AL objects mentioned
As named in the post. A name that matches one object page by exact type and name links to it; the others stay as named.
- page 30 “Item Card”
- page 40 “Item Journal”
- page 5841 “Standard Cost Worksheet”
- page 38 “Item Ledger Entries”
- page 5802 “Value Entries”
- page 20 “General Ledger Entries”
- page 461 “Inventory Setup”
Context
- Features: standard costing method, item card management, stock keeping units, item journal posting, cost adjustment, sales invoice processing, automatic cost adjustment
Source: The Dynamics Explorer, community blog. Summary, key points and quotes are derived (CONTENT-NOTICE.md); read the original for the full text.