Sales Processing | Guided by A Guide to Cloud

The Sales Cycle

Simple explanation

If the purchase cycle is about buying things, the sales cycle is the mirror image — selling them.

A customer asks for a price (quote). You convert it into an order. The warehouse ships the goods (shipment). You send the customer a bill (invoice). Business Central tracks every step, just like it does for purchasing, but from the seller’s perspective.

At Summit Distribution, Leo the sales lead manages quotes and orders. The warehouse ships goods, and Sofia at Coastal Traders handles the customer invoicing.

Sales Document Flow

Sales Quote ──→ Sales Order ──→ Posted Shipment ──→ Posted Invoice
     │                                                     ▲
     └──────────→ Sales Invoice ───────────────────────────┘
                  (skip order stage)

Sales Quote — Pricing proposal for a customer. No financial impact. Can convert to Order or Invoice.
Sales Order — Commitment to deliver. Supports partial shipments and invoicing.
Sales Invoice — For simple sales where you ship and invoice simultaneously.

Managing Sales Quotes

Leo receives a request from a customer for pricing on 200 office chairs.

Steps:

Search for Sales Quotes and create a new quote
Select the customer (or create a new one inline)
Add items with quantities, prices, and any discounts
Send the quote to the customer (print, email, or share via OneDrive)

Converting a Quote

When the customer accepts:

Make Order — Converts the quote into a sales order. Use when you need to track shipments separately from invoicing (most common for physical goods).
Make Invoice — Converts directly into a sales invoice. Use for simple sales where delivery tracking is not needed (e.g., services, digital products).

The original quote is archived automatically. If the customer declines, you can simply delete or archive the quote.

Exam tip: Quote conversion

The exam may present scenarios asking whether to convert a quote to an order or an invoice. The key decision: does the business need to track shipment separately from invoicing? If yes, use Make Order. If it is a simple transaction with no physical delivery to track, use Make Invoice.

Item Availability

Before confirming an order, you need to know if you have enough stock. BC provides item availability checks at multiple levels.

Availability Check on Order Entry

When Leo enters a quantity on a sales order line, BC checks current inventory. If stock is insufficient, a stockout warning appears showing:

Information	What it shows
Current inventory	Stock on hand
Scheduled receipts	Incoming purchase orders and production orders
Gross requirement	Committed sales orders and production demand
Projected available balance	Inventory plus receipts minus requirements

Item Availability By options

From any Item Card or sales line, you can check availability broken down by:

By Period — Week, month, quarter, year
By Location — Stock at each warehouse
By Variant — Stock of each variant (e.g., colour)
By Event — Timeline showing every inbound and outbound event
By BOM Level — For assembled/manufactured items, availability of components

Leo uses “By Location” most often — if the main warehouse is out of stock, he can check whether the secondary warehouse has units available and arrange a transfer.

Shipping Items

When the warehouse is ready to fulfil an order, you post a shipment.

Full Shipment

Set Qty. to Ship equal to the full quantity, then click Post and choose Ship. This creates a Posted Sales Shipment and reduces inventory.

Partial Shipments

If only part of the order can be fulfilled (e.g., 150 of 200 chairs are in stock):

Set Qty. to Ship to 150
Post the shipment
The sales order remains open for the remaining 50 units

Field	After partial shipment
Quantity	200 (original order)
Qty. Shipped	150
Qty. to Ship	50 (remaining)

Multiple shipments can be posted against the same sales order until the full quantity is delivered.

Reversing a Shipment (Undo Shipment)

If a shipment was posted in error — wrong items shipped, wrong quantity recorded — you can reverse it.

Steps:

Open the Posted Sales Shipment
Select the line(s) to reverse
Click Undo Shipment

BC creates a negative shipment entry, adds the items back to inventory, and re-opens the sales order line.

Limitations:

You can only undo shipments that have not yet been invoiced
If the items were already consumed (e.g., a warehouse transfer processed them), undo is not available

Creating a Sales Invoice from a Sales Order

Two approaches, mirroring the purchase side:

Option 1: Invoice Directly from the Sales Order

Open the sales order
Set Qty. to Invoice for each line (BC defaults to shipped-but-not-yet-invoiced quantity)
Click Post and choose Invoice (or Ship and Invoice for simultaneous posting)

Option 2: Separate Sales Invoice

Create a new Sales Invoice
Use Get Shipment Lines to pull in posted shipment lines from one or more sales orders
Useful when you want to consolidate multiple orders into one invoice

Scenario: Sofia's consolidated invoice

Sofia at Coastal Traders sends a monthly invoice to one of their regular customers, covering all shipments during the month. She creates a single Sales Invoice, uses Get Shipment Lines to pull in four posted shipments from the past 30 days, and posts one consolidated invoice. The customer receives one bill instead of four.

Recurring Sales Lines

For customers who buy the same items regularly (monthly maintenance contracts, weekly supply orders), set up recurring sales lines to auto-populate.

Setup:

Open the Customer Card
Navigate to Related > Sales > Recurring Sales Lines
Add lines with Item No., Description, Quantity, and Price
Set the recurrence pattern

Usage:

When Leo creates a new sales order for that customer, he clicks Get Recurring Sales Lines and the standard items populate automatically. Prices and quantities are pre-filled — Leo just confirms and posts.

Blanket Sales Orders

A blanket sales order is a framework agreement with a customer for purchasing large quantities over time.

When to Use

Long-term customer contracts (e.g., “Customer X will buy 5,000 units over 6 months”)
Agreed pricing locked in for the contract period
Deliveries scheduled and released as needed

How They Work

Create a Blanket Sales Order with the total agreed quantity and price
When a delivery is due, use Make Order to create a regular sales order for that batch
The blanket order tracks released vs remaining quantities

Example: Coastal Traders has a standing agreement with a hotel chain to supply 2,400 towels over 12 months at a fixed unit price. Olivia creates a blanket sales order for 2,400. Each month, Leo releases 200 towels by creating a sales order from the blanket.

Aspect	Sales Order	Blanket Sales Order
Purpose	One-time or ad-hoc sale	Long-term framework agreement
Quantity	Exact quantity for this delivery	Total agreed quantity over the contract
Pricing	Set per order	Locked in for the contract duration
Deliveries	Single delivery (or partial shipments)	Multiple releases over time via Make Order
Inventory impact	Yes — when shipped	No direct impact — only when released sales orders are shipped
Typical use	Standard customer orders	Annual supply contracts, recurring customer agreements

Deferrals on Sales Documents

Revenue recognition rules often require spreading income across multiple periods. A 12-month service contract invoiced upfront should recognise revenue monthly, not all at once.

Applying Deferrals

Create a deferral template (e.g., “SVC-12M” for 12-month straight-line)
On a sales order or invoice line, set the Deferral Code
Click Deferral Schedule to review the period-by-period breakdown
When posted, BC automatically creates G/L entries spreading revenue across periods

Example: Coastal Traders invoices a customer 6,000 for a 6-month maintenance contract. Sofia applies the “SVC-6M” deferral template. When posted, BC debits Accounts Receivable for the full 6,000, credits a deferred revenue account, and then posts 1,000 per month to the revenue account over 6 months.

Purchase vs Sales Processing — Side by Side

Aspect	Purchase Processing	Sales Processing
Document flow	Quote to Order to Receipt to Invoice	Quote to Order to Shipment to Invoice
Quote conversion	Make Order	Make Order or Make Invoice
Receiving / shipping	Post Receipt (increases inventory)	Post Shipment (decreases inventory)
Over-receipt feature?	Yes — configurable tolerance	No — no over-shipment feature
Undo action	Undo Receipt (on Posted Purchase Receipt)	Undo Shipment (on Posted Sales Shipment)
Consolidated invoicing	Get Receipt Lines on a Purchase Invoice	Get Shipment Lines on a Sales Invoice
Blanket orders	Blanket Purchase Order	Blanket Sales Order
Recurring lines	Recurring Purchase Lines (on Vendor Card)	Recurring Sales Lines (on Customer Card)
Deferrals	Spread costs (expenses)	Spread revenue (income)
Availability check	Not applicable (you are the buyer)	Item availability check with stockout warning

Exam tip: Key differences

The exam loves testing these differences:

Over-receipts exist for purchasing. There is NO equivalent “over-shipment” for sales.
Item availability is checked on sales orders, not purchase orders (you are the one who needs stock to ship).
Sales quotes can be converted to either an order OR an invoice. Purchase quotes can only be converted to an order.
Both sides support blanket orders, recurring lines, and deferrals — the concept is identical, just mirrored.

Question

What are the two ways to convert a sales quote?