The receiving inventory is

The receiving inventory is used only in WMS.

In inventory (W/o WMS) when you receive the material you don’t specify any sub inventory. So it’s difficult to track the materail after receiving and before delivering it to a sub inventory/locator.

In WMS first you receive the material to a receiving sub inventory and in the process you specify a LPN.  After that you can track the material through that LPN. When you are ready to move the material to a storage location, you do the put away.

The material in storage sub inventory are not on hand as system does not consider them while planning but you can make these LPNs to be considered as on hand for cross docking.