diff --git a/src/components/pages/inventory/adjustment/form/InventoryAdjustmentForm.tsx b/src/components/pages/inventory/adjustment/form/InventoryAdjustmentForm.tsx
index 19738b00..faa73a3a 100644
--- a/src/components/pages/inventory/adjustment/form/InventoryAdjustmentForm.tsx
+++ b/src/components/pages/inventory/adjustment/form/InventoryAdjustmentForm.tsx
@@ -372,6 +372,13 @@ const InventoryAdjustmentForm = ({
     }
   }, [selectedTransactionSubtype]);
 
+  useEffect(() => {
+    if (selectedTransactionType?.value === 'RECORDING' && selectedProduct) {
+      setSelectedTransactionSubtype(null);
+      formik.setFieldValue('transaction_subtype', '');
+    }
+  }, [selectedProduct, selectedTransactionType]);
+
   // ===== EVENT HANDLERS =====
   const locationChangeHandler = (val: OptionType | OptionType[] | null) => {
     const location = val as OptionType | null;