If you work with inventory in Business Central, there comes a time when the cost of your items needs to be corrected or updated.
That’s exactly what the Item Revaluation Journal is for.
In this guide, I’ll walk you through the complete process step by step.
What is Item Revaluation Journal?
The Item Revaluation Journal is used to change (revalue) the cost of inventory items that already exist in Microsoft Dynamics 365 Business Central.
It is commonly used when:
- Market price of raw materials has changed
- Items were received with an incorrect cost
- Year-end inventory valuation adjustments are required
- Exchange rate changes affect imported inventory costs
Before You Start – Prerequisites
Before performing an item revaluation, make sure the following conditions are met:
- Costing Method is correctly configured (FIFO, Average, Standard, or Specific).
- Posting Date falls within an open accounting period.
- Your user account has Inventory Journal Posting permissions.
- The item already has Item Ledger Entries.
- Inventory Period is open for the selected posting date.
Step 1 – Open Revaluation Journal
- Click the Search (🔍) icon.
- Type Revaluation Journal.
- Select Revaluation Journals from the search results.
- The Revaluation Journal page opens.
Step 2 – Select a Batch
At the top of the journal:
- Choose an existing Batch Name (for example, DEFAULT).
- Or click New to create a new batch.
Tip: Batches help organize inventory revaluations by month, department, or business unit.
Step 3 – Calculate Inventory Value (Auto Fill)
This is the recommended method.
- Click Functions → Calculate Inventory Value.
Fill in the following information:
| Field | Description |
|---|---|
| Calculation Date | Date for inventory valuation (Example: 31/03/2025) |
| Document No. | Reference number (Example: REVAL-2025-001) |
| Calculate Per | Select Item (Recommended) |
| By Location | Enable if using multiple warehouse locations |
Click OK.
Business Central automatically populates all inventory items with their current costs.
Step 4 – Enter the New Revalued Cost
Locate the Unit Cost (Revalued) column.
Enter the new inventory cost.
Example:
- Old Cost = ₹500
- New Cost = ₹620
Enter 620 in the Unit Cost (Revalued) field.
Business Central automatically calculates:
Inventory Value (Revalued) = New Cost × Quantity
If you don’t want to revalue a particular item, simply delete that journal line.
Step 5 – Verify Before Posting
Before posting, verify the following information:
- Applies-to Entry
- Quantity on Hand
- Unit Cost (Calculated)
- Unit Cost (Revalued)
- Posting Date
Always ensure everything is correct before posting.
Step 6 – Post the Journal
- Click Post (or press F9).
- Confirm the posting message.
- Click Yes.
- After successful posting, the journal lines are automatically cleared.
Step 7 – Verify the Posted Entries
After posting, verify the changes.
Item Ledger Entries
Navigate to:
Items → Item Card → Item Ledger Entries
Look for:
Entry Type = Revaluation
Value Entries
From the Item Ledger Entry:
Navigate → Value Entries
You should see a new Revaluation value entry.
General Ledger Entries
The adjustment will automatically post to:
- Inventory Account
- Inventory Adjustment Account
Key Fields Reference
| Field | Description |
|---|---|
| Unit Cost (Calculated) | Existing inventory cost |
| Unit Cost (Revalued) | New inventory cost entered by the user |
| Inventory Value (Revalued) | Automatically calculated value |
| Posting Date | Date of inventory adjustment |
| Document No. | Reference number for the journal |
Common Errors and Solutions
Posting Date Not in Open Period
Cause: Selected posting date is closed.
Solution: Open the Inventory Period or choose another posting date.
No Lines After Calculate Inventory Value
Cause: Items may have zero inventory or incorrect filters.
Solution: Check inventory quantity and applied filters.
Permission Error During Posting
Cause: Missing Inventory Journal Posting permission.
Solution: Ask your Business Central administrator to assign the required permission.
Cost Did Not Change After Posting
Cause: The revalued cost is the same as the current cost.
Solution: Enter a different value in Unit Cost (Revalued).
Complete Process Overview
- Open Revaluation Journal
- Select Batch
- Calculate Inventory Value
- Enter New Unit Cost
- Verify Journal Lines
- Post the Journal
- Verify Ledger Entries
Pro Tip
Always save a screenshot or export the journal before posting. This provides an audit trail and makes it easier to review inventory cost changes later.
Conclusion
The Item Revaluation Journal is an essential feature in Microsoft Dynamics 365 Business Central for maintaining accurate inventory valuation. By following the steps above, you can safely update inventory costs while ensuring your financial records remain accurate and compliant.
Found this guide helpful?
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