The Default Consume Forecast by Period Method is Limit by Ship-By Month, and the Consume Closest Forecast Demand to SO Line Ship-By Date option is selected.

You enter a sales order for 300 units to ship by 7/30/08.

The forecast that is closest to the sales order ship-by date within the same calendar month (the 7/30 forecast) is consumed first and moved to the sales order demand quantity.

The 7/30 open forecast quantity of 200 is insufficient to meet the sales order demand; 100 units remain. These units are consumed from the next closest date.

Because the 7/29 and 7/31 forecasts are equally close, the earlier forecast (7/29) is consumed. Only part of that open forecast quantity is consumed, and the 7/29 forecast is left with an open sales forecast quantity of 100.