When performing a physical inventory of serialized items, if the counted qty is less than the expected qty, the physical inventory worksheet updates the item quantity when the physical inventory worksheet is committed.
What it doesn't do is prompt you to tell it which serial number is missing. Shouldn't this process work the same as receiving/issuing purchase/transfer orders, where serial numbers must be entered for all product being rec'd/issued?
If you have the 'Synchronize quantity with serial numbers' option turned on (like I do) then you end up with a supposedly impossible situation after committing the physical counts: an available serial number count that doesn't match the quantity on hand. Try to fix it by deleting the missing serial number and the quantity goes down by 1, creating a new inventory discrepancy.
I searched this group for similar questions and found one, but no proper answer was ever provided.
Please help, Tom