When installing Microsoft Dynamics NAV 5.0 Service Pack 1 (SP1) on Windows 7, you might receive the following error 1935 message:
Error 1935. An error occurred during the installation of assembly component {98CB24AD-52FB-DB5F-A01F-C8B3B9A1E18E}. HRESULT: 0x800736CC.
If Microsoft SQL Server is not installed or SQL Server Express is not installed as part of the Microsoft Dynamics NAV installation options, the error 1935 on Windows 7 may occur. To fix this error, you just download and install the Microsoft Visual C++ 2005 SP1 from the following Microsoft Download Center Web site: http://www.microsoft.com/downloads/details.aspx?FamilyID=200b2fd9-ae1a-4a14-984d-389c36f85647 At last, try to install Microsoft Dynamics NAV 5.0 SP1 again, the error will disappear.

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