Did you test this from SSMS? Did you try addint print @BatchID at the top of the procedure?

>In this proc I pass in 0 or a BatchId from a previous run. If a batchId is passed, I want to use it, otherwise, compute the next
>batch Id and use that.
>
>This is alwats incrementing the batch Id. I don't see what's wrong.
>
>
>

>
>CREATE PROCEDURE ap_AddInventoryRecord
>	@PartId			INT = NULL,	
>	@WarehouseId	INT = NULL,
>	@LocationId		INT = NULL,
>	@UserId			INT = NULL,
>	@SerialNo		VARCHAR(30) = NULL,
>	@Quantity		INT = 1,
>	@DropShip		TINYINT = NULL,
>	@Printed		TINYINT = NULL,
>	@ActionDate		DATETIME = NULL,
>	@PurchaseOrder	VARCHAR(30) = NULL,
> 	@Comments		TEXT = NULL,
>	@InventoryId	INT = NULL OUTPUT,
>	@BatchId		INT OUTPUT
>
>AS
>BEGIN
>
>	IF @ActionDate IS NULL
>		BEGIN
>			SET @ActionDate = GETDATE()
>		END
>
>	IF(@BatchId IS NULL OR @BatchId = 0)
>		BEGIN
>			SELECT @BatchId = MAX(BatchId) + 1 FROM Inventory
>		END
>
>	IF(@BatchId IS NULL)
>		BEGIN
>			SET @BatchId = 1
>		END
>
>	INSERT INTO Inventory
>		(BatchId, PartId, WarehouseId, LocationId, UserId, SerialNo, Quantity,
>		DropShip, Printed, ActionDate, PurchaseOrder, Comments)
>		VALUES
>		(@BatchId, @PartId, @WarehouseId, @LocationId, @UserId, @SerialNo, @Quantity, 
>		@DropShip, @Printed, @ActionDate, @PurchaseOrder, @Comments)
>	
>	SET @InventoryId = SCOPE_IDENTITY()
>
>END
>