SAP MM Interview Question and Answer

Part 1 :

1. What is meant by scales? 

You can fix a price in the info record for a say qty from 1-100 price RS150 & if the order qty is 101- 500- the prices is 140. Scales cannot be used directly in PO but can be pulled into the PO from various master data like info records, quota arrangements.

2. What are the Main Master Files used in Mm? 

• Material master file
• Inventory master file
• Vendor master file

3. What do you mean by goods receipt and post goods receipt? 

Goods receipt is the physical inbound transfer for goods or material into the warehouse. It is the transfer of goods which is used to post goods received from external vendors or from in-plant production. All goods receipts result in an increase in stock in the warehouse.

Post-Goods Receipt is used to post the receipt of goods with reference to the purchase order with which the goods were ordered. If the material is delivered for some purchase order, it is important for all of the departments involved that the goods receipt entry in the system references this purchase order.

4. Can you Release the Po Item by Item When you have a Multiline-item Po? 

No, you cannot release the PO item by item. PO can be released at the header level by using the with classification release procedure.

5. Is it possible that you can use scales in Quotation? 

No

6. How to Release Purchase Order? Which Transaction Code is used to display as well as reset the Release of Po? 

You can release a purchase order at header level. You cannot release a single item in purchase order. You need to release all the items at a time. The ME29N transaction code is used to display as well as reset the release of purchase order.

7. Define ERS. 

ERS stands for Evaluated Receipts Settlement. It refers to the process of settling down receipts of the goods in an automatic manner. In this process, an agreement is made between the vendor and the user that vendors do not prepare any invoice for the goods ordered. Rather, the system would automatically generate and post the invoice document on the basis of purchase order and receipts of goods.

8. Why is record of the information of purchase useful? 

It is essential because it collects various information on the vendor and the materials supplied by them. For instance the current price at which the vendor is selling the material is recorded in the purchase record.

9. Define purchase requisition. 

A purchase requisition is a primary document which is used as part of the accounting method to launch a merchandise or supply purchase. By processing a purchase order, suitable controls can monitor the legitimacy of purchase, as well as identify the business requirement for the products.

10. What Is Stochastic Block? 

Stochastic Blocking is the process of checking the incoming invoices. In this process, blocking of the invoices is done randomly. Invoices with high value have the highest probability to get blocked. It is set for the whole invoice instead at the item level. When posting of the invoice is done, an R is set in the Payment Block field in the document header data.

11. How can Batch Records be changed? 

You can change a batch record by using the transaction code MSC2N. The navigation path of changing the batch record is:

SAP Menu -> Logistics -> Materials Management -> Material Master -> Batch -» Change.

You can change the batch record, but you should note that these changes are also available for review.

12. What is Internal Procurement? 

Large corporate organizations may own multiple separate businesses or companies. Internal Procurement is process of getting material and services from among identical company. So, each of these companies maintains a complete bookkeeping system with separate Balance, Profit & Loss Statements so that when trade occurs between them it will be recorded.

13. Give the Names of the Tables where the Material Master Data is Stored. 

The MARA and MARC are the two tables where the master data is stored.

14. What are the components of the Master Data that details a companys Procurement used by, Vendor Evaluation for example? 

The key components of Master Data are:

• Info Record (ME11)
• Source List (ME01)
• Quota Arrangement (MEQ1)
• Vendor (MK01)
• Vendor Evaluation (ME61)
• Condition Type (MEKA).

15. What is the code used for extension of the view of material? 

The code used for the transaction of the material view is MM50.

16. A Purchase requisition is an internal document or external document? 

Internal document, it is the phase in which purchasing department is informed about the requirement of items or services required for business purpose.

17. What are the different accounts used in Invoicing? 

• Vendor accounts
• Stock accounts
• GR/IR clearing accounts
• Tax account
• Price differences account Cash difference clearing account Freight clearing account

18. How many Company Codes can be assigned to a Company? 

You can assign one or more company codes to a company.

19. Explain reservation. 

Reservation is the blocking of the stock beforehand so that its availability is ensured later in time. It ensures that the stock is made available and can be used as per requirement.

20. Can a Company Code be assigned to many Plants? 

Yes, you can assign a company code to many plants.

21. What is a Material Master File? 

the complete information related to managing a material is stored and maintained in a data record in the material master, which is sorted on the basis of different criteria.

22. What is External Procurement? 

It is the process of procuring goods or services from external vendors. There are 3 basic forms of external procurement generally supported by the Purchasing component of IT system.

23. List out the essential components of material management. 

• Determine requirements
• Source determination
• Vendor Selection
• Order Processing
• Order follow up
• Goods receipts and Inventory management
• Invoice Verification

24. What is a request for quotation (RFQ) document? 

RFQ or Request for Quotation also known as Invitation for Bid is a document which an organization submits to one or more potential suppliers to invite them for the bidding process for a product or service.

25. What do you mean by the Lot Size? 

The lot size is the quantity of materials used for re-ordering. It can be static, periodic, optimum, or fixed in attributes.

26. Give the Names of the Tables where the Header Level and Item Data are Stored in a Purchase Order. 

The EKKO and EKPO are the two tables where the header and item level data are stored, respectively.

27. What is the Menu Path to define Material Type Attributes? 

The following is the menu path to define material type attributes:

Select Logistics Master Data: Material Master -> Material -> Control data -> Define material type attributes.

28. What Is Release Strategy? How many Release Points can be involved in a Release Process? 

The release strategy specifies the release codes with which a purchase document must be released and the sequence in which the release must be used. you can define a maximum of eight release codes with their respective release strategies. you can involve 8 release points in a release process.

29. What are the Plant-specific Data in Material? 

The MRP data and forecast data are the plant-specific data in material.

30. What Is Goods Issue Reversal? 

The process of issuing the material back to the stock of material is known as a goods issue reversal. For example, if goods issued to the production order are 500 kg of material and only 300 kg is consumed, then the rest 200 kg is returned to stock.

31. List the Movement Types for Unplanned Goods received. 

• 501
• 561
• 531

32. How do you flag a material for deletion? 

A deletion flag can be set at client level, plant level or storage location level. Transaction MM06 is used to mark a material for deletion.

33. What Is the Transaction Code to Set Price Control for Receipts (goods/invoice)? 

The transaction code OMW1 is used to set price control for receipts (goods/invoice).

34. What is the use of ‘Split Valuation’? 

Within a valuation area, sometimes, we need to valuate various stocks of a material separately. It can be because of different origin, quality, status, etc. We use split valuation in such cases. In this case, material is managed at several partial stocks which are sub-stocks of main material stock. Any transaction, relevant for valuation, is carried at this partial stock level. In accounting view, we define if we need split valuation for any material.

35. How are parked documents showed? 

Parked documents are showed with the codes FBV3 and FB03. FBV3 displays the parked sheets whereas FB03 shows all the posted sheets. It is useful to use FBV3 if one needs to know if any documents still need approval or if they still need completion.

36. What is movement in receipt out (MIRO)? 

MIRO or Movement in Receipt Out deals with invoice verification activities for bills raised from the vendors end. So, basically, MIRO is booked by the finance department.

37. Can a Company Code be assigned to many Plants? 

You can assign many company codes in a chart of accounts.

38. What do you mean by Release Group? 

The transaction codes ME54 and ME29N are used to define the release procedures for PR and PO, respectively.

39. What is returnable transport packaging (RTP)? 

Returnable transport packaging (RTP) is a multi-trip packaging medium in which goods can be transported more than once between retailers and customers.

40. How is quota rating checked? 

he formula for checking the quota rating is addition of the base quantity of the quota and the allocated quantity quota and divides it by the overall quota.

41. How can you create a Purchasing Information Record? 

You can create a purchasing information record either manually or automatically by setting the Info update indicator when maintaining a quotation, a purchase order, or an agreement.

42. What is a Cost Center? 

Cost Center accounting is used for controlling purposes. It is an organizational unit within a controlling area which represents a defined location of cost incurrence. For example, any department can be a cost center for recording all expenses incurred for that department.

43. What Transaction Code is used to extend the Material View? 

The MM50 transaction code is used to extend the material view.

44. What is a planned order in material management? 

A planned order is sent to an industry and is a material requirement planning request for the procurement of a particular material at a determined time. It specifies when the internal material movement needs to be made and the amount of material that is demanded.

45. What Is the Purpose of Material Valuation? 

Material valuation in SAP MM module is necessary to determine the stock value of materials.

46. What is a Material Ledger? 

A material ledger retains all transactions that relate to the purchase and use of materials for producing goods. Material ledger data is valuation and control data for a material in a plant for a specific posting period. Material ledger contains data for material movements that are relevant to the valuation of the material.

47. What is the Role of the Confirmation Control Key? 

The confirmation control key is used to specify whether or not a notification for shipping is expected PO item.

48. What is Batch Information Cockpit? 

The Batch Information Cockpit (BIC) is the main switching point having a wide range of options for scrutiny and control. It stores all the information related to the analysis of a particular batch at a single location.

49. How is the list of all Reservations in the Systems Displayed? 

The reservation list can be displayed by running the RM07RESL report.

50. Define Storage Location in SAP. 

In SAP system, a storage location is the place where you can store your stock of goods, within the premises of a plant. Each plant has at least one storage location assigned to it.

51. What do you mean by Release Group? 

Release group is a two-digit code that is assigned with a class and contains one or more release strategies. For example, release group 01 is defined for purchase requisitions and release group 02 is defined for purchase order.

52. What is meant by master data? 

Master Data is basically created centrally and is valid for almost all the applications. It remains constant over time but it is required to update it on a regular basis. For example, the Vendor is a type of master data and he is used for creating purchase orders.

53. How Material Valuation is associated with Financial Accounting? 

Material valuation in MM module is associated with Financial Accounting as any change in the stock value also updates the G/L account in Financial Accounting.

54. What is a transaction code in material management? 

A transaction code (or t–code) consists of letters, numbers, or both, and is entered in the command field at the top of any SAP GUI screen. Each function in SAP ERP has an SAP transaction code associated with it. You can directly access any function in SAP using t-codes.

55. What is the code used for reservation? 

The Transactional code used for reservation is MB21.

56. What is a Scheduling agreement? 

Scheduling agreement is a long term outline agreement between vendor and ordering party over a predefined material or service which are procured on predetermined dates over a framework of time.

57. What are Purchasing Information Records? 

The purchasing information records, also known as info record, contain information related to the material and vendor who is supplying the material. It also contains details about the material, such as the current price of the material.

58. Where is Material Master Data saved? 

Tables MARA and MARC.

59. What is the use of BOM usage type 1 in SAP system? 

It is used for Production.

60. What is EAN? 

An article can be carried in different units of measure. An European article number (EAN) is created as a unique indicator for each of these units of measure. The most important use of EANs within a company is to identify articles at the point of sale (POS) using the barcode.

61. What is the Source of Error “not Allowed” in case of Custom Movement Type Creation? 

You need to check the allowed transaction for the customized movement types and use the OMJJ transaction code.

62. How do you access the Materials Management Configuration Menu? 

Transaction Code OLMS has a host of options that are not accessible through the IMG.

63. What is Master Data nn MM Module? 

Master data in MM module acts as a reference data defining various business entities and plays a key role in the core operation of a business.

64. Can you add Custom Fields to Purchase Order(s) and Request for Quotation(s)? 

Yes, you can add custom fields to a Purchase Order and Request for Quotation.

65. What are the features of material management? 

• Purchasing
• Production and material control
• Non-production stores
• Transportation
• Material handling
• Receiving

66. What is a Profit Center? 

Profit Center Accounting evaluates the profit or loss of individual, independent areas within an organization. Profit center is an organizational unit in controlling to recognize your profit. Profit center is attached to material master at plant level.

67. Mention, for the stock transport order, some movement types. 

Some of the movement types are 351, 641, 643 for the stock order. Another one is 301 which can be used an easy way for transferring materials.

68. How do you define a Release Procedure for Prs and Pos? 

Use Transaction ME54 and ME28 respectively.

69. How is scrap material taken care of in sub-contracting? 

Scrap can be maintained in BOM as operational scrap, component scrap, By-Product or Co-Product. Common practice is to maintain scrap as by-product and receive it back along with processed material.

70. What are quotations in SAP material management? 

Quotations in SAP MM are certain requests for vendors which provides us with some information about their best prices, terms and conditions, schedules of deliveries and other information in order to select the best source for our procurement needs.

71. Can Forecast Model be selected automatically? 

The forecast model can be selected automatically by entering the value J in the Forecast Model field in the Material Master record where the value J is used for Automatic Model Selection.

72. What are the Benefits of document Parking? 

The benefit of document parking is that you can modify the invoice in a parked status whereas the invoice that is placed on hold cannot be modified.

73. What is Intra plant stock transfer type in SAP MM? 

Storage Location to Storage Location.

74. What is the Lot Size Attribute of a Material? 

The lot size attribute represents the reorder quantity for a material. A material can have a periodic, optimum, or a static or fixed lot size.

75. What is the Transaction Code to convert Planned Order into Purchase Requisition (pr)? 

MD14 is the transaction code to convert planned order into PR.

76. What do you understand by GR Blocked stock? 

This is conditionally accepted stock and not the unrestricted stock.

77. What is the type for the reversal of the issue of the goods? 

The transactional type for the reversal of the issue of the goods is the number 262.

78. Mention t-code to create Purchase Requisition in MM. 

Transaction code ME51N can be used to create Purchase Requisition in MM.

79. How is the value of the Cross-company-code Stock Displayed? 

You need to perform the following steps to display the value of the cross-company-code stock in transit:

Select Environment-> Stock-> Stock in transit.

80. What is the Transaction Code to display Material of Sap MM? 

MM03 is the transaction code to display material of SAP MM.

81. What Is a Standard Service Catalog (ssc)? 

A Standard Service Catalog (SSC) is a general standardized catalog that contains the detailed explanation of services. The descriptions of these services are stored as master records and help to remove data duplication.

82. What is Special Procurement? 

Special stocks are stocks that are managed differently as these stocks did not belong to company and these are being kept at some particular location.

83. Can we change the Industry Sector of an existing Material? 

No, once assigned you cannot change the industry sector of an existing material.

84. Where do We define Payment Terms in PO? 

The payment terms in PO represent the agreements of customers and vendors. you can define the payment terms in PO in the master records of customers and vendors.

85. What are the benefits or uses of material management? 

• Material valuation
• Multi-location inventory
• Bin management
• The lot and serial traceability
• Product life cycle management
• Inventory replenishment
• Scheduling and resourcing

86. What is Price Comparison? 

Price comparison is used to compare quotations from different vendors. You can use transaction code ME49 to perform a price comparison between different vendors.

87. What Is the Release Procedure? 

The release procedure allows you to create condition records for the planning process. It is used to creating Purchase Requisitions (PR), Purchase Orders (PO), Request for Quotation (RFQ), Outline Agreements, and Service Entry Sheets.

88. What do you mean by Material Numbers In SAP? 

Material numbers are unique numbers used to identify a material.

89. Tcode for Stock overview? 

MMBE.

90. What is the Creation Indicator? 

The creation indicator defines whether or not the planned orders, purchase requisitions, or schedule lines must be created for materials that are procured externally. It also defines whether or not MRP lists need to be created.

91. How is a receipt posted? 

The goods receipt can be posted by going to the option of logistics and then to the materials management and then the inventory management and the choosing the goods movement and then choosing the T code which is MIGO.

92. What is a request for information (RFI)? 

A request for information or RFI is a basic business process which collects written information about the capabilities of suppliers. It generally follows a format which can be used for comparative purposes.

93. What Is Release Code? 

The release code is a two-character field or ID that represents the person responsible for the approval of the release procedure.

94. How many Company Codes can be assigned to a Plant? 

You can assign only one company code to a plant.

95. What are the different types of ERPs? 

Different types of ERPs are as follows: SAP, Microsoft dynamics, People Soft, Oracles, Siebel, BAAN. These are some of the different types of Enterprise Resource Planning.

96. Can you include An Roh (raw Material) Type In the Sales View? 

Usually, the raw materials cannot be included in the sales view. However, the raw materials can be included in the sales view only when they are sold to procure finished products in return.

97. What is Material Status? 

It is 2 digit code and is used to determine the material usability.

98. What is NetWeaver? 

NetWeaver is an incorporated technology in which every product in the MySAP group can be used in a single go of a server which is known as SAP Web Application Server. This technology is very useful and helps the user efficiently. One of the advantages of using this is that the data related to SAP can be accessed by the enterprise through or even through mobile. This is not only cost effective but also time effective. If one uses this a lot of money is saved which could otherwise go in training a new user in the SAPclient.

99. What is consumption-based planning (CBP)? 

It is based on past consumption values which makes use of the forecast or other statistical procedures to determine future requirements. It is triggered when the stock level falls below a predefined reorder point or by forecast requirements calculated using past consumption values.

100. What is SAP MM and what do you know about it? 

It is one of the modules in SAP that deals with the management of materials and procurement process. It also includes master data, account determination, material valuation, inventory management, invoice verification, material requirement planning, etc.

101. What are the different type of Basic Procurement? 

• Procurement for Stock vs Consumption
• External vs Internal Procurement

102. Name the T Code for Invoice Verification. 

An invoice is verified by using the OLMR T code.

103. How many Charts of Accounts can be assigned In a Company? 

In a company, only one chart of accounts can be assigned.

104. What is the movement type for Goods issue reversal? 

Movement type is 262 in Goods issue reversal.

105. What is invoice processing? 

Invoice processing is a process a company’s account payable uses to manage supplier invoices. It begins when you accept an invoice and ends when payment has been made and reported in the general ledger.

106. Why would an Organization need to allow Negative Stocks? 

Negative Stocks are necessary when Goods issues are entered necessarily (business process reasons) prior to the corresponding Goods Receipts and the material is already located physically in the warehouse.

107. Define Valuation Class. 

Valuation class is a group of different materials that share some common properties. This group is defined so that you do not have to manage a separate account for each material.

108. Can we change the Material Type of a Material? 

Yes, we can change the material type of a material.

109. How do you configure the Release Procedure? 

Use Transaction OMGQ.

110. What is master data management? 

Master data management is a comprehensive method of enabling an enterprise to link all of its critical data to a common point of reference. When properly done, MDM improves data quality, while streamlining data sharing across personnel and departments. In addition, MDM can facilitate computing in multiple system architectures, platforms, and applications.

111. What is material requirement planning (MRP)? 

It is a module in SAP enterprise resource planning. It is a type of planning tool to help production and procurement planners to create feasible and realistic plans which helps to quickly initiate procurement and production process.

112. How to create a Batch? 

You can create a batch record manually by using the transaction code MSC1N. The navigation path of creating a batch is:

SAP Menu -> Logistics -> Materials Management -> Material Master -> Batch -> Create.

113. What is the Menu Path to create a document/e-mail Notification for your Supplier? 

The following is the menu path to create a document/e-mail notification for your supplier:

Select Material Management-> Logistics Invoice Verification -> Message Determination.

114. What do you mean by Forecast-based Planning? 

Forecast-based planning is a process used in consumption-based planning which depends on predictions of future requirements calculated on the basis of forecast.

115. What is planned delivery and GR processing time? 

The meaning of planned delivery is the number of business days in which the person is expected to receive the materials and goods. The GR processing time is the number of business day in which the person has to inspect and place the material in the storage, after obtaining the goods and materials.

116. What is Vendor Sub-range? 

The vendor sub-range is defined as a subdivision of the total range of products provided by a vendor. Vendor sub-ranges are required when you create or maintain Material Master data.

117. What is the Transaction Code to create Movement Types? 

OMJJ is the transaction code to create movement types.

118. Can you generate packing/picking lists for goods issue in SAP MM? 

In SAP EWM you can generate packing list.

119. How to make a Dummy Reservation? 

The user can try to create a new movement type with reference to 201 movement type.

120. Why does the Invoices get blocked? 

• Variance in the invoice item
• Amount of an invoice item
• Stochastic block
• Manual block

121. Mention the last stage in the cycle of procurement? 

The last stage of the procurement cycle is the verification of the invoice. This also updates the documents which are related in the accounts and finances. There is a difference between the real invoice and the blocked one the real invoice can be handled by verification of the invoice.

122. How can you disable a reservation In MRP? 

Use Transaction Code OPPI to check “block stock”.

123. What do you mean source list and what is the code of the source list? 

The source list is to identify the home of the supply from where the materials come. The code for creating the source list: ME01.

124. What Transaction Codes are used With Reservations? 

• The MB21 transaction code: Creates a reservation.
• The MB22 transaction code: Changes a reservation.
• The MB23 transaction code: Displays a reservation.
• The MB25 transaction code: Displays lists of reservations.

125. How can the Logical Value for the Stock Items be found? 

You need to use the MC49 transaction code to find the logical value of the stock items by date.

126. What Is Valuation area? 

Valuation area is the organizational level at which the material valuation is carried out.

127. Mention the code to access the Material Requirement Planning list. 

For accessing a single item one can use the code MD05.

128. What is free item in SAP system? 

The Price will be marked zero for free item. We can tick the item as free item while creating PO in system.

129. How do you create a Vendor? 

Use Transaction Code XK01. Add the Vendor name, Company Code, Purchasing Organization, Account Group, and the Vendor address. Next add the country, Bank Key, Bank Account, Account Holder (an actual name), and then save the data.

130. What is the Transaction Code to access the Materials Management Configuration Menu? 

The OLMS transaction code is used to access the Materials Management Configuration menu.

131. What are contracts in material management? 

A contract is a long-term agreement with a vendor to supply a material or provide a service for a certain period of time. These are specified consequently in release orders issued against the contract when the customer requires them.

132. Define stock population. 

Stock population is the total of all stock management units included in an inventory sampling. These stock management units are uniquely defined through the allocation of the stock management levels to a given inventory sampling. As a result, the stock population is also defined when you allocate stock management levels.

133. How is GR/IR account related to Inventory? ­ 

If you are involved with inventory, then you need the GR/IR account (Inventory Account) when the IR is posted. If you are not involved about inventory, then the system does not need the GR/IR account when the IR is posted; the system needs a G/L instead of the GR/IR account.

134. What is a special stock in material management? 

Special Stocks are the stocks which belong to a company code. These are not placed in any storage location & no physical inventory is performed.

135. What is a One-time Vendor? 

A one-time vendor is the vendor who rarely or only once supplies the materials or articles to your company. For such vendors, you do not need to create a separate master record because the master records have no use after the business transaction is completed. Therefore, you can collectively create a master record for all the one-time vendors.

136. What Is Lifo Valuation? 

LIFO is a balance sheet valuation technique. It stands for last in-first out principle, i.e. the material added to the stock in last is valuated first. In this technique, the pricing of old material in stock is not affected by the pricing of new material. In this technique, a layer of stock increased or decreased is created for a fiscal year, on the basis of which the valuation is done.

137. How to Determine Stock Value? 

The stock value of the materials is calculated using the following formula:

Stock value = Stock quantity * Material price.

138. What is the code for deleting a particular batch? 

The code for deleting a batch is MSC2N. Alternatively, if one flags the batch of the master record then the batch record can be deleted completely.

139. What is production order and purchase order? 

A production order determines which material is to be prepared, at which location, and at what time and how much quantity is required. It also defines which components and sequence of operations are to be used and how the order costs are to be resolved.

A purchase order is a formal request or guidance from a purchasing organization to a vendor or a factory to supply or provide a certain quantity of goods or services at or by a certain point in time.

140. How can a Stock Transfer be monitored in Purchasing? 

A storage location is a unique four-character alphanumeric key; therefore, it cannot be common for two plants.

141. How are User Defaults Set for Views? 

You can set user defaults for views by selecting Defaults->Views.

142. What is a Price Comparison? 

Perform a price comparison using ME49 and one may compare quotations from different vendors.

143. What is movement in goods out (MIGO)? 

MIGO or Movement in Goods Out is used for goods movement such as goods issue, goods receipt, plant to plant transfer, storage location to storage location transfer, etc. Basically, MIGO is booked by the logistics department where the goods are actually received.

144. What is inventory management? 

Inventory management is used to manage the inventory for the goods. It is based on several key processes. Definition of movement types, reservations, goods issue, and goods receipt.

145. What do you mean by Physical Inventory? 

Physical inventory is the recording of actual stock levels (quantities) of materials by counting, weighing, or measuring at a given storage location at a specific time.

146. How do you check Stock Requirement List in SAP system? 

This is used to see current stock and planned receipts. Use T-code: MD04. Enter Material and Plant to see list.

147. What is MRP run in SAP system? 

MRP run or planning run is an engine which is used to fill demand and supply gap. Issues & Receipts are called MRP Elements. Issues include PIRs, Dependent Requirements, Order Reservations, Sales Orders, Issuing Stock Transfer Orders, etc. and receipts include Production Orders, Purchase Requisitions, Purchase Orders, Open Production Orders, Receiving Stock Transfer Order, Schedule lines, etc.

148. What Is Movement Type? 

While implementing the goods movement in an organization, the movement type is required to be entered. It is a three-digit identification key that is entered as per the movement type. The following are the common movement types that are used in SAP:

• 102: Goods that are receipt against a purchase order
• 201: Goods that are issued
• 321: Goods released from quality inspection stock

149. What is a request for proposal (RFP)? 

RFP or Request for Proposal is a document which requests a proposal, which is generally made through a bidding process by an agency or a company for the acquisition of some commodity, asset, or service to any potential suppliers to submit business proposals.

150. What is essential for creating a record of purchase information? 

The essential information for making a record of purchase information is as follows The number of the material, the part number of the manufacturer, the number of the vendor, the level code of the organization.

151. Define consignment stock. 

During the consignment process, when a vendor provides material or goods, the company stores it in their stores. The vendor remains the owner of the material until a customer takes it. The liability arises as soon as the material is removed from the stores.

152. Can we receive the goods before the scheduled delivery date in scheduling agreement? 

No, we cannot receive the goods before scheduled delivery date. GR can be posted on or after the scheduled dates. Though, SAP has provided some OSS notes to resolve this. (708973, 741385)

153. What is Quota Arrangement in SAP system? 

A particular material can be procured from different vendors depending upon the requirement. So, total requirement of a material is distributed to different vendor’s i.e. quota is assigned to each source of supply. This is known as quota arrangement.

154. What is a Batch? 

A batch is a group of materials combined together quantity-wise for various reasons. Very often, the materials with the same characteristics and values are grouped into a batch. For example, in a chemical industry, a certain number of containers of a specific product may be considered a batch as these products were produced at the same time and have the same physical and chemical characteristics.

155. What is movement type and mention a few standard movement types? 

Movement types are used as indicators of what is the purpose of the goods movement (e.g. from the storage location to a storage location, receipt from the purchase order, issue for the delivery, receipt from production).

156. What is the Transaction Code to create a Material Type? 

MOS2 is the transaction code to create a material type.

157. How to delete a Batch? 

You can delete a batch by using the MSC2N transaction code. You can delete a batch record by flagging the batch master record. For this, you need to first select the batch in the Change mode.

158. What is Master production schedule (MSP)? 

It is a plan for individual commodities to be produced in each time period such as staffing, production, etc. It is mostly linked with manufacturing in which the plan denotes when and how much of each product will be demanded.

159. What is the process order? 

Process Orders (PP-PI-POR) are the central component used for the accurate planning and execution of process manufacturing. A process order represents the production of batches (materials) in a production run or the rendering of services.

160. How can a Stock Transfer be monitored in Purchasing? 

A stock transfer can be monitored in Purchasing by using the following stock documents:

• Purchase requisition
• Stock transport order (STO)
• Stock transport scheduling agreement

161. How is a Class created? 

A class is a collection of the group of the characteristics for a particular object. You need to enter the class name and a description for it and then select the group. After saving the details, the class is created. Alternatively, you can use CL01 T-code for this purpose.

162. How do you check Quota Rating? 

Quota rating = (Quota Allocated Quantity + Quota Base Quantity)/Quota

163. What are the different Stock transfer types in SAP system? 

• Inter Company
• Intra Company
• Intra Plant

164. What is the difference between MRP and CBP? 

In material requirement planning, the prediction of material requirement is based on sales and operations planning while in, consumption-based planning the prediction of material requirement is made, based on historical demand for materials.

Part 2 :

Q1: What is SAP MM?

Answer: MM means Material Management. It is a functional module in SAP. It deals with the procurement process and the management of materials. It has master data, material valuation, invoice verification, material requirement planning, etc.

Q2: What are the advantages of SAP material management?

Answer:

• Multi-location inventory
• Inventory replenishment
• Product life cycle management
• Material valuation
• The lot and serial traceability
• Bin management
• Scheduling and resourcing

Q3: What are the necessary components of SAP material management?

Answer:

• Vendor Selection
• Order Processing
• Order follow up
• Invoice Verification
• Source determination
• Determine requirements
• Goods receipts and Inventory management

Q4: Name the different types of stocks

Answer: There are three different types of stocks;

• Valuated Stock
• Non-valuated stock
• Special Stock

Where the valuated stock is further divided into three parts- Unrestricted stock, Blocked stock, and Quality Inspection Stock, and Special Stock is classified as Stock Transport Order, Subcontracting, Consignment, Returnable Transport Packaging, Stock Transport Order, Pipeline Handling, and Third Party Processing.

Q5: What is Consignment Stock?

Answer: Consignment stocks mean those materials that are still available in the store premises, but belongs to the owner or seller. When the buyer uses the consignment stocks, he has to pay for them.

Q6: What is Special Procurement?

Answer: Special Procurement in SAP MM means those stocks that do not belong to a company. These are kept at different locations.

Q7: Name some common assignment types in the SAP Material Management system?

Answer:

• Purchasing organization to company code
• Standard purchasing organization to plant
• Plant to Company code
• Purchasing organization to Plant

Q8: Name different Info record types?

Answer:

• Standard
• Pipeline
• Subcontracting
• Consignment

Q9: What is a Purchase Order?

Answer: A purchase order is sent by a buyer to his sender to final confirm the requirements. Instead of having the names and quantity of materials, the purchase order also has valuable information like details of purchasing company with a company code, name of material along with the corresponding plant, and date for delivery of material.

Q10: What is Internal Procurement?

Answer: In large organizations, there are different separate businesses. With an internal procurement process, the requirements of material and services are gathered from an identical company. However, each identical company has to maintain a completer bookkeeping system along with separate Profit and Loss statements, Balance Sheets.

Q11: What is External Procurement?

Answer: When the procurement of products or services is done from external vendors, it is known as an external procurement. It has three primary forms, such as:

One time orders: This term is used for those goods that are needed irregularly.

Longer-term contracts: This term is used for those materials that are ordered regularly in large quantities.

Longer-term scheduling agreements: This term is used for that material, which is ordered regularly and also in large quantities.

Q12: What is RFQ?

Answer: RFQ is a Request for quotation. It is an invitation that is sent to sellers to submit quotes showing pricing and also terms and conditions. RFQ also has details regarding the date of delivery, goods and services, quantity, and date of submission.

Q13: How is the document type used in the SAP system?

Answer: The document type is used to indicate different procedures for a transaction in the SAP system.

Q14: How can we use Purchase Info Record?

Answer: It is used to store information about the material and also about that vendor who is supplying that material.

Q15: Name the different Procurement types that you can establish Purchase requisition in SAP MM?

Answer: A purchase requisition is created for the following procurement types;

Stock transfer: Transfer of material within the organization.

Subcontracting: Sending raw material to the seller and getting back finished material.

Standard: Getting back finished material from the seller.

External service: Availing services from third-party sellers like maintenance.

Consignment: Paying the seller regarding the procuring material that is available on the company’s premises.

Q16: Name some features of SAP material management?

Answer:

• Purchasing
• Receiving
• Non-production stores
• Transportation
• Production and material control
• Material handling

Q17: What do you mean by material requirement planning (MRP)?

Answer: Material requirement planning or MRP is a module in SAP ERP (Enterprise Resource Planning). It is a sort of planning tool to assist procurement and production planners in establishing realistic and possible plans which help to initiate procurement and production procedures swiftly.

Q18: What do you mean by consumption-based planning (CBP)?

Answer: Consumption-based planning or CBP is dependent upon past consumption values. It is used to forecast to find out future requirements. These processes in CBP do not rely on the master production schedule. It is activated either when the stock level comes below a particular reorder point or when the forecast needs calculating with past consumption values.

Q19: Explain the terms production order and purchase order?

Answer: 

Production order: It decides which material needs to be prepared at which time and location and also concern about the quantity required. It also determines about components and sequence of operations that need to be involved. Moreover, it also concerns about the order costs need to be resolved.

Purchase order: It is issued by a vendor or a factory to supply a certain quantity of products and services at a particular time and location.

Q20: What is the process order in SAP MM?

Answer: When thorough planning and execution of process manufacturing is determined, it is known as process orders. It identifies the production of materials in a production run.

Q21: What is a transaction code in SAP MM or material management?

Answer: T-code is a term used for transaction code. It has numbers of letters or both which are used to enter the command field that is available at the top of the SAP GUI screen. Kindly note that every function in SAP ERP equips with the SAP transaction code that is related to it. We can directly look at any function in SAP with the assistance of the transaction code.

Q22: How can you differentiate the terms MRP and CBP?

Answer: The primary difference between CBP and MRP is that when we plan material, we use MRP to predict the requirements of materials based on SOP (sales and operations planning). Moreover, in CBP, we have to forecast the MM (material management) depended upon the historical demand for materials.

Q23: What do you mean by the Master production schedule (MSP)?

Answer: MSP is used to plan for individual commodities that need to produce in each time, such as production, inventory, staffing, etc. It is linked to manufacturing, where the plan shows how much and when each product will be demanded.
Q24: Name the different types of Basic Procurement?

Answer: 

• External vs. Internal Procurement
• Procurement for Stock vs. Consumption

Q25: How can you differentiate procurement for stock vs. consumption?

Answer: 

Procurement for Stock: It means the storage of material in stock. In it, the material gets stored once it received from the seller. The quantity of stock material depends upon the demand for the material. To record all information about the stock, we maintain the master record in the system.

Procurement for Direct Consumption: When the storage of material is used or consumed once it received, it is known as procurement for direct consumption. Before ordering material for consumption, a master record is maintained within the system.

Q26: How can we use SAP MM or Material Management module?

Answer: 

SAP MM is the backbone of the logistics area, which has modules like sales and distribution, project system, plant maintenance, production planning, and material management that is obsessed with the MM Module.

MM module supports all sorts of material management like control, planning, etc.

MM module assists in managing the procurement activity of a company from procurement.

Q27: What steps are involved in Procurement Lifecycle?

Answer: 

Check about the requirements: The procurement process starts with gathering information about the goods and their quantity. Once gathered all the information, the necessary steps are taken to find out the suppliers to satisfy the requirements.

Contact suppliers: After gathering all the information, the next will be to look for suppliers to get the requirements. Then, quotation requests are sent to suppliers to get the best rates.

Review about the background: Once you get to know about the suppliers, necessary steps are taken to investigate the suppliers like warranties, maintenance services, etc. that he can offer along with supply.

Negotiation: After reviewing the background, negotiation is done by the buyer. Whatever negotiation is made, it is finalized by an agreement along with other information like delivery date, the quantity of material, etc.

Fulfilment of Order: Finally, the order becomes delivered to the supplier accordingly ordered.

Consumption, Maintenance, and Disposal: Lastly, necessary steps are initiated to consume, maintained, and dispose of the material.

Q28: What is MIRO?

Answer: MIRO means movement in receipt out. It deals with invoice verification activities in terms of bills raised from the vendor’s end. MIRO is basically used by MIRO.

Q29: What is invoice processing?

Answer:  It is used by a company’s account payable to manage supplier invoices. Invoice processing is initiated when an invoice is accepted and ends when it becomes clear, and it becomes shown in the general ledger.

Q30: What is MIGO?

Answer: MIGO means movement in goods out. It is used for those goods that are moving out like from plant to plant transfer, goods receipt, storage location to storage location transfer, etc. The term MIGO is used by the logistics departments.

Q31: What is an RFI?

Answer: RFI means a request for information. It is used for the business process that assembles written information about the competencies of sellers.

Q32: What is an RFP?

Answer: RFP means Request for Proposal. It is a document where a proposal is sent by a company or agency for the acquisition of some goods and services to any potential seller to send business proposals.
Q35: Which steps are used in the RFQ process?

Answer: There are several steps used to process RFQ:

First, enter the t-code (transaction code) as ME41, then enter the RFQ type as ‘AN.’

After this, write down the location, i.e., the late date when the seller submits the quotation. Now, enter the purchasing group, delivery date, and other information, and press the click button.

After this, you will be able to watch a new screen wherein you have to fill in the item codes. Now enter the item codes and also the vendor’s details.

Moreover, more requests can be made as per vendors’ details.

Q36: What do you mean by contracts in MM?

Answer: A contract is a document in terms of a long term agreement. It is issued to supply services for a particular period to the vendor. This document is used to release orders when the buyers required.

Q37: What is a purchase requisition?

Answer: It is a primary document to launch a product or supply purchase. It is used as part of the accounting method. With this document, the buyer can get an idea about the purchases and also identifies the business requirements.

Q38: What is RTP?

Answer: RTP means returnable transport packaging. It is a multi-trip packaging medium where goods or products are transported more than a single time between customers and retailers.

Q39: How can purchase requisition is created and released in SAP MM?    

Answer: With the help of T-code ME51N, a purchase requisition is created with the help of this process:

First, execution of the ME51N transaction.

Then, arrange purchase requisition document type: NB

Now source determination: OFF or ON

Now enter heater note, material number, UoM, Quantity, and storage location.

Then, the vendor is automatically decided with source determination.

Now add the tracking number, valuation prices, and final save the transaction data.

Q40: What is the stock population?

Answer: In an inventory sampling, the total of all stock management units is known as the stock population.

Q41: What is a goods receipt and post goods receipt?

Answer: When the physical inbound transfer of material and goods are made into the warehouse is known as Goods receipt. It includes the transfer of those goods that have received from in-plant production or external vendors. Issuing of goods receipt always results in a hike in stock in the warehouse.

When the receipt of goods are posted concerning the purchase order with which products or goods were ordered are known as a post-goods receipt. When the material is sent concerning a purchase order, then all departments must make an entry in the system references.

Q42: Why is Material type in SAP MM?

Answer: It is used to group different materials as per some common properties.

Q43: What do you mean by the Outline agreement?

Answer: Outline agreement is a purchase agreement that is made on a long term basis. It is made with the seller having terms and conditions about the goods or material that is needed to send by the seller. This agreement is valid for a particular time, and it covers a specific predefined quantity or value.

Q44: What is Material Master in SAP? How can it be maintained in the SAP system?

Answer: Material master has information regarding different sorts of material such as raw material, finished product. It is used to identify a product, goods issue, goods receipt, purchase material, production confirmation, and MRP.

Use T-code for material master data. Go to logistics, then to production, then master data, then material master, then material, then create, and then immediately.

Q45: How is the Posting Period in a company?

Answer: The term posting period in a company is used to define five fields such as;

• Maintain Fiscal Year Variant
• Define Variants for Open Posting Periods
• Open and Close Posting Periods
• Assign Variant to Company Code
• Assign Fiscal Year Variant to Company Code

Q46: What is a Contract in SAP, MM?

Answer: In SAP MM, the contract is a long-term agreement that is made between the seller and ordering party for predefined material for a specific framework. Basically, there are two types of contracts.

Quantity Contract: In a quality contract, the entire value is mentioned in terms of the quantity needed to be supplied by the seller.

Value Contract: In a value contract, the entire amount that is needed to be paid by the vendor.

Q 47: What is the difference between the terms RFQ, RFI, and RFP in SAP MM?

Answer: When an invoice is processed, then RFI assembles sellers’ information, RFQ gets the best price for the whole project while RFP creates the best project.

In the case of the status of the solution, RFI doesn’t define anything, RFQ defines the details and project clearly, while RFP understands the entire situation.

Moreover, RFI offers information about the sellers, RFQ provides the statement of work regarding a project, while RFP defines pricing details.

Q48: What is the significance of the batch record?

Answer: A batch is used to get about the quality of a particular product that is needed to process or produced simultaneously. It should be noted that the material that is produced in such a batch must have the same attributes and values. Moreover, the batch record ensures information about a specific batch product. It also assists in letting know whether the product has gone through Good Manufacturing Process (GMP) or not.

Q49: How can we amend the standard price in the master material?

Answer: The fact is, we cannot amend or update the standard price for the material data directly. Moreover, when we need to change the standard rate in master material, then some steps need to be followed like:

• Fill up the future field price (MBEW-ZKPRS).
• Fill up useful data (MBEW-ZKDAT) in terms of materials.
• Now select logistics, then material management, then valuation, then valuation price, then determination, then future price.

Q50: What is the purpose of SAP Movement types?

Answer: 

101 Movement Type: It is used for Goods Receipt against the Purchase Order.

102 Movement Type: It is used as a reverse of the material document that was created in 101 movement type.

122 Movement Type: It is used to return goods to the seller.

123 Movement Type: It is used to cancel movement 122 documents.

161 Movement Type: It is used to return products to the seller against a purchase order for

162 Movement Type: It is used to cancel the movement 161 documents.

201 Movement Type: It is used to process Goods issue against the cost centre.

202 Movement Type: It is used to cancel the 201 movement document.

221 Movement Type: It is used to process Goods issue against projects.

222 Movement Type: It is used to cancel the 221 movement document.

261 Movement Type: It is used to process Goods issue against the order.

262 Movement Type: It is used to cancel the 261 movement document.

311 Movement Type: It is used when there is a need to transfer posting between storage locations.

312 Movement Type: It is used to cancel the 311 movement document.

321 Movement Type: It is used to transfer goods or products from quality to unrestricted stock.

322 Movement Type: It is used in case of a reverse of 321 movement type.

343 Movement Type: It is used to transfer goods or products from unblocked to unrestricted stock.

344 Movement Type: It is used in case of a reverse of 343 movement type.

349 Movement Type: It is used to transfer goods or products from blocked to quality stock.

350 Movement Type: It is used in case of a reverse of 349 movement type.

411 Movement Type: It is used to transfer their own stock or goods to own.

412 Movement Type: It is used in case of a reverse of 411 movement type.

501 Movement Type: It is used to issue Goods Receipt without any purchase order.

502 Movement Type: It is used in case of a reverse of 502 movement type.

511 Movement Type: It is used to issue free of charge goods receipt.

512 Movement Type: It is used in case of a reverse of the 511 movement type.

551 Movement Type: It is used to process Goods Issue for scrapping.

552 Movement Type: It is used in case of a reverse of 551 movement type.

561 Movement Type: It is used to show the initial entry of stock.

562 Movement Type: It is used in case of a reverse of 561 movement type.

601 Movement Type: It is used to issue Good’s Issue against delivery.

602 Movement Type: It is used in case of a reverse of the 601 movement type.

641 Movement Type: It is used to transfer or send goods to stock in transit.

642 Movement Type: It is used in case of a reverse of 641 movement type.

651 Movement Type: It is used in case of return delivery of goods.

652 Movement Type: It is used in case of a reverse of 651 movement type.

Part 3 :

1). What is the difference between CBP and MRP?

The main difference between CBP and MRP 

2). What do you know about SAP MM?

AP has a functional module which is known as SAP MM. It looks after the management of the material and obtaining handling. The module consists mainly of master data, the configuration of the system, and transactions to complete the procurement to pay process.

3). Can you elaborate on SAP and how it is useful in Industries?

SAP stands for Systems, Applications, and Processing the Data.  It is the most popular software application used to provide enterprise business solutions. This ERP  software application was first introduced in Germany (Mannheim) in the year 1972. ERP stands for Enterprise Resource Planning.

It provides solutions by incorporating various business tasks like sales, purchase, and production. SAP obtains details from one business process and integrates them into another business process, thus speeding up the business process. 

It is broadly used in industries, since it updates and process important data very quickly and used by the department to determine how to prepare the products and also it can program business process and provide real-time solutions for business.

4). Can you explain the essential components in SAP MM?

To define the requirements,  determination sources, selection of vendors, order processing, follow up with the clients, receipts of goods and inventory management, verification of bills, payment systems, etc.

5). Do you know about organizational structure in the MM module?

The structure in the MM module is a ladder in which various organizational units are arranged designed according to the functions and tasks of each of them. The units that make the structure of the organization are as given below. 

The first is the client and this unit is independent. This unit has a different record system and well as its own table sets. The second is the company code. This is one of the smaller units of the organization. For the need for external reports, one can make a self-reliant account set for the unit of company code. The third is the plan.

This is where the supplies are formed and the services and goods are given. The industry can be broken down into different plants based on maintenance, supplies, production, procurement, etc.  The next is the location of the storage. The produced goods are kept in this unit. The next is the number of the warehouse this shows the system of the warehouse.

It is different for every area of storage and organization. After that is the storage type which tells one the different areas such as issuing area, area for picking up the goods, etc. The next is the organization of the purchasing which is the unit that negotiates with others for purchasing and also obtains the services and the material.

The next is group purchasing which is a code for an individual buyer or a group who actually purchases the materials. This unit is also partially involved in negotiating and obtaining the goods.

6). Explain in detail the order of purchase?

This is a final and formal confirmation of the essential materials to be supplied by the vendor to the industry. This will involve all the names of the essential materials with the equivalent plant. The details of the purchase would include the code of the company, the vendor’s name, the delivery date of the materials. 

7). Why is the record of the information of purchase useful?

It is essential because it collects various information on the vendor and the materials supplied by them. For instance, the current price at which the vendor is selling the material is recorded in the purchase record. 

8). What are the important criteria in purchasing?

The important criteria in purchasing include the following the unit of the order, the group of material, the base unit, the group of purchasing, the validity, the indicator of tax for that material, the part number of the manufacturer, and the manufacturer. 

9). Elaborate on the receipt of the goods in the SAP System?

Once the purchase is processed by the vendor the material and goods are delivered to the party that ordered it and this process is known as the receipt of the goods. During this time when the material is delivered the party that acquires checks for the quality and the condition of the materials and goods. After the verification, the receipt is finally poster. 

10). What is the code used for the extension of the view of material?

The code used for the transaction of the material view is MM50.

11). What is the code for deleting a particular batch?

The code for deleting a batch is MSC2N. Alternatively, if one flags the batch of the master record then the batch record can be deleted completely. 

12). How is a receipt posted?

The goods receipt can be posted by going to the option of logistics and then to the materials management and then the inventory management and the choosing the goods movement and then choosing the T code which is MIGO. 

13). What do you mean by source list and what is the code of the source list?

The source list is to identify the home of the supply from where the materials come. The code for creating the source list: ME01. 

14). What is essential for creating a record of purchase information?

The essential information for making a record of purchase information is as follows
The number of the material, the part number of the manufacturer, the number of the vendor, the level code of the organization.

15). What is planned delivery and GR processing time?

The meaning of planned delivery is the number of business days in which the person is expected to receive the materials and goods. The GR processing time is the number of business days in which the person has to inspect and place the material in the storage, after obtaining the goods and materials.

16). What is the Material Requirement Panning and mention the code to access this list?

Material Requirement Planning is the first working manuscript from where the controller of MRP starts the work and it includes the planning of the information of the goods and materials. For accessing a single item one can use the code MD05. 

17). What is known as RFQ?

RFQ is an abbreviation for Request For Quotation. It is a kind of a form that is given to the vendors for them to submit any quotation which is indicative of the terms and conditions and the price of the goods and materials. It has details of the quantity of the goods, information about the goods, the delivery date of when the form is to be submitted. 

18). Explain what is the reservation?

Reservation is the blocking of the stock beforehand so that its availability is ensured later in time. It ensures that the stock is made available and can be used as per requirement.

19). What is the code used for reservation?

The Transactional code used for reservation is MB21.

20). Tcode for a Stock overview?

MMBE.

21). What is CBP?

CBP essentially means the consumption value of the materials in the past. It is used to know about the requirements in the future. Based on the consumption of the services in the past, the average requirement of the goods can be calculated. 

22). What is the type for the reversal of the issue of the goods?

The transactional type for the reversal of the issue of the goods is the number 262.  

23). How is quota rating checked?

The formula for checking the quota rating is the addition of the base quantity of the quota and the allocated quantity quota and divides it by the overall quota. 

24). Mention the last stage in the cycle of procurement?

The last stage of the procurement cycle is the verification of the invoice. This also updates the documents which are related to the accounts and finances. There is a difference between the real invoice and the blocked one the real invoice can be handled by verification of the invoice.

25). Mention, for the stock transport order, some movement types. 

Some of the movement types are 351, 641, 643 for the stock order. Another one is 301 which can be used as an easy way for transferring materials.  

26). What is the point of difference between the purchase order and the purchase requisition?

A purchase requisition is said to an internal sheet and it is an appeal that is done to the organization which is going to purchase the services and send the list of the goods. But purchase order is the formal sheet that is sent to the vendor which has the list of the essential items that need to be taken from the vendor. 

27). How does one do a verification of the invoice?

When the invoice is related to an existing sheet then every information which is relevant is taken out by the system. This includes material, vendor, delivery, and its terms, payment, etc. One has to enter the invoice and the system takes out the account, tax, discount, and corrections that are relevant. If the invoice is been posted data like the average of the price are reorganized. 

28). How are parked documents showed?

Parked documents are showed with the codes FBV3 and FB03. FBV3 displays the parked sheets whereas FB03 shows all the posted sheets. It is useful to use FBV3 if one needs to know if any documents still need approval or if they still need completion. 

29). What are the different types of ERPs?

Different types of ERPs are as follows: SAP, Microsoft dynamics, People Soft, Oracles, Siebel, BAAN. These are some of the different types of Enterprise Resource Planning. 

30). What is NetWeaver?

NetWeaver is an incorporated technology in which every product in the MySAP group can be used in a single go of a server which is known as SAP Web Application Server. This technology is very useful and helps the user efficiently. One of the advantages of using this is that the data related to SAP can be accessed by the enterprise through or even through mobile. This is not only cost-effective but also time-effective. If one uses this a lot of money is saved which could otherwise go into training a new user in the SAPclient. 

31). Explain Metadata, Transaction data, and master data? Can SAP be called a type of database?

Metadata: Metadata informs a person about the information of a data. This gives a person in-depth information about the hierarchy of the information or it is also called Meta Objects. There are many types of metadata. Some of the metadata are structural metadata, descriptive metadata, reference metadata, statistical metadata, and administrative metadata. Each of these types has a different kind of function in a system. 

Next is the transaction data. This is nothing but the information pertaining to the transactions which happen on the day to day basis. After that comes the master data. Data provides essential information about the materials, the employees, and even information related to the customer of that service. One can also call it the data of reference.

For instance: the person orders a product which is 20 units. So instead of asking for the customer’s address 20 times, the same information can be used from the master data of the customer. 

SAP cannot be called a database. Since it is an application it uses the databases which are provided by other retailers. These retailers include Server, Oracle, SOL, and many other retailers.

Part 4 :

1) What is the use of SAP Material Management module?

Ans:

• SAP Materials Management (MM) is a part of Logistics area and helps to manage the procurement activity of an organization from procurement.
• It supports all aspects of material management (planning, control etc).
• It is the backbone of the Logistics area which incorporates modules like Sales and Distribution, Production Planning, Plant Maintenance, Project Systems, Warehouse Management which are extremely obsessed on Materials Management module.

2) What do you understand from Procurement process in SAP MM?

Ans:

Every organization acquires material or services to complete its business needs. The process of buying materials and obtaining services from vendors or dealers is procurement.

3) Explain steps in Procurement Lifecycle?

Ans:

Requirement and Information Gathering

• Procurement process starts with gathering information about product and its quantity. Then for required products and services, it is necessary to look for suppliers who can satisfy the requirements.

Supplier Contact

• After gathering requirements one will look for the suppliers who can fulfill the requirements. Based on that quotation request or information request can be made to suppliers or direct contact can be made with them.

Background Review

• Once the supplier is known product/service quality is checked, and any necessities for services such as installation, warranty and its maintenance are investigated. Some samples of the products can be obtained for quality examination.

Negotiation

• Some negotiations with suppliers is made regarding price, availability and delivery schedule of the products/services. After this a contract is signed that is a binding legal document between supplier and ordering party. A contract will include all necessary information like price and quantity of material, delivery date, etc.

Order fulfillment

• Ordered material will be shipped, delivered to the ordering party and supplier is paid accordingly. Training and Installation of product or services may also be included.

Consumption, Maintenance and Disposal

• As the products/service is consumed the performance of the products or services is evaluated and any follow up service support if required is analyzed.

4) A Purchase requisition is an internal document or external document?

Ans:

Internal document, it is the phase in which purchasing department is informed about the requirement of items or services required for business purpose.

5) What are the different type of Basic Procurement?

Ans:

There are 2 types of Basic procurement which are shown below −

• Procurement for Stock vs Consumption
• External vs Internal Procurement

6) What is the difference between Procurement for stock vs consumption?

Ans:

Procurement for Stock − A stock material is a material that is kept in stock. These materials are kept in stock once received from the vendor. The stock of this material keeps on increasing or decreasing based on amount of the quantity received or issued. To order a material for stock, the material must have a master record within the system.

Procurement for Direct Consumption − When procurement is for direct consumption i.e. it will be consumed as soon as it is received, the user should specify the consumption purpose. To order a material for consumption, the material may have a master record within the system.

7) What is External Procurement?

Ans:

External procurement − It is the process of procuring goods or services from external vendors. There are 3 basic forms of external procurement generally supported by the Purchasing component of IT system.

One time orders are generally used for material and services that are ordered irregularly.

Longer-term contracts with the subsequent issue of release orders – For materials that are being ordered regularly and in large quantities, we can negotiate deal with the vendor (seller) for pricing or conditions & record then in a contract. In a contract you also specify the validity date.

Longer-term scheduling agreements and delivery schedules – If a material is ordered on an everyday basis and is to be delivered according to an exact time schedule, then you set up a scheduling agreement.

8) What is Internal Procurement?

Ans:

Internal Procurement − Large corporate organizations may own multiple separate businesses or companies. Internal Procurement is process of getting material and services from among identical company. So, each of these companies maintains a complete bookkeeping system with separate Balance, Profit & Loss Statements so that when trade occurs between them it will be recorded.

9) What is Special Procurement?

Ans:

Special Procurement

Special stocks are stocks that are managed differently as these stocks did not belong to company and these are being kept at some particular location.

10) What is Consignment Stock?

Ans:

Consignment Stocks

Material that is available at our store premises, however it still belongs to the vendor (seller)/Owner of the material. If you utilize the material from consignment stocks, then you have to pay to the vendor.

11) What are the common assignment types in SAP MM system?

Ans:

• Plant to Company code
• Purchasing organization to company code
• Purchasing organization to Plant
• Standard purchasing organization to plant

12) What are the different Info record types?

Ans:

• Standard
• Consignment
• Subcontracting
• Pipeline

13) How do you flag a material for deletion?

Ans:

A deletion flag can be set at client level, plant level or storage location level. Transaction MM06 is used to mark a material for deletion.

14) What is the use of Purchase Info Record?

Ans:

Purchasing info record stores information on material and vendor supplying that material. For Example: Vendors current price of a particular material is stored in info record.

15) Where do you maintain Purchase Info Records in SAP MM?

Ans:

Purchase info record can be maintained at plant level or at purchasing organization level.

16) What is Purchase Order?

Ans:

Purchase order is the formal and final confirmation of the requirements which is sent to vendor to supply material or services. Purchase order will include important information like name of material with its corresponding plant, details of purchasing organization with its company code, name of vendor, and date for delivery of material.

17) What do you understand by Goods Receipt in SAP system?

Ans:

After processing of purchase order by vendor, material is delivered to ordering party and this process is called as goods receipt. So, goods receipt is the phase in which the material is received by the ordering party and the condition and quality are verified. Once material is verified against quality then goods receipt is posted.

18) How do you post goods receipt?

Ans:

Path to post Goods Receipt −

Logistics ⇒ Materials Management ⇒ Inventory management ⇒ Goods movement ⇒ Goods movement

T-Code: MIGO

19) What are the different Procurement types that you can create Purchase requisition?

Ans:

Purchase requisition can be created for the following procurement types −

Standard − Getting finished material from vendor.

Subcontracting − Providing raw material to vendor and getting finished material.

Consignment − Procuring material that is kept in company’s premises and paying to vendor for that.

Stock transfer − Getting material from within the organization.

External service − Getting services like maintenance from third party vendor.

20) How can you create a Purchase Order from Purchase Requisition?

Ans:

Purchase Order from purchase requisition can be created by following below steps −

T-Code: ME21N

Top of Form

Bottom of Form

21) What is Request for Quotation RFQ?

Ans:

Request for quotation is a form of invitation that is sent to vendors to submit quotation indicating pricing and their terms and conditions.

RFQ contains details about goods or services, quantity, date of delivery and date of bid on which it is to be submitted.

22) What is the use of document type in SAP system?

Ans:

In SAP system, you use Document Type to define different methods or procedures for a transaction.

23) What is free item in SAP system?

Ans:

The Price will be marked zero for free item. We can tick the item as free item while creating PO in system.

24) Why do you use Material type?

Material type in SAP system is used to group various materials based on some common properties.

25) What is Material Status?

Ans:

It is 2 digit code and is used to determine the material usability.

26) What are the different stock types in SAP system?

Ans:

• Restricted Stock
• Unrestricted Stock
• Quality Inspection Stock
• Blocked Stock
• GR Blocked Stock

27) What do you understand by GR Blocked stock?

Ans:

This is conditionally accepted stock and not the unrestricted stock.

28) What are the different Stock transfer types in SAP system?

Ans:

• Inter Company
• Intra Company
• Intra Plant

29) What is Intra plant stock transfer type in SAP MM?

Ans:

Storage Location to Storage Location

30) What is an Outline agreement?

Ans:

Outline agreement is a long term purchasing agreement with vendor containing terms and conditions regarding the material that is supplied by vendor.

Outline agreement are valid up to certain period of time and cover a certain predefined quantity or value.

31) Is it possible that you can use scales in Quotation?

Ans:

No

32) What do you understand by Material Master? How Material master is maintained in SAP system?

Ans:

Material master contains information related to different material types like finished product, raw material. Material master can be used for identifying a product, purchase material, goods issue or good receipt, MRP and production confirmation.

For Material master data, use T-code: MM01 or go to Logistics → Production → Master Data → Material Master → Material → Create (General) → immediately

33) What is the use of BOM usage type 1 in SAP system?

Ans:

It is used for Production

34) How do you create Purchase Order or Purchase Requisition from Material Requirement Planning?

Ans:

The PR is created according to the safety stock mentioned for the material or can be triggered from a requirement. For creating a PO, you need to have the scheduling agreement in place. After the MRP is run the schedule lines are generated which are nothing but the PO.

35) What is MRP run in SAP system?

Ans:

MRP run or planning run is an engine which is used to fill demand and supply gap. Issues & Receipts are called MRP Elements. Issues include PIRs, Dependent Requirements, Order Reservations, Sales Orders, Issuing Stock Transfer Orders, etc. and receipts include Production Orders, Purchase Requisitions, Purchase Orders, Open Production Orders, Receiving Stock Transfer Order, Schedule lines, etc.

36) How do you check Stock Requirement List in SAP system?

Ans:

This is used to see current stock and planned receipts. Use T-code: MD04

Enter Material and Plant to see list.

37) What is the use of MRP list?

Ans:

MRP List is used to generate static report that contains planning run material wise and it displays time of MRP run at the top.

Use T-Code: MD05

38) What is the Production Order?

Ans:

A Production order is used to define the material to be produced, plant location where production has to be done, date and time of production, quantity of goods required. A Production Order also defines which components and sequence of operations are to be used and how the order costs are to be settled.

39) How do you check the available stock at any point of time?

Ans:

You can use Stock overview to check the available stock at any point of time. Stock overview can be checked using T-Code: MMBE

40) What is a Contract?

Ans:

Contract is a long term outline agreement between vendor and ordering party over predefined material or services over certain framework of time. There are two types of contract −

Quantity Contract −

In this type of contract overall value is specified in terms of total quantity of material to be supplied by vendor.

Value Contract −

In this type of contract overall value is specified in terms of total amount to be paid for that material to the vendor.

41) What is the movement type for Goods issue reversal?

Ans:

Movement type is 262 in Goods issue reversal.

42) What is the use of Material Document List?

Ans:

Material document list is used to generate any goods movement such as goods receipt, goods issue for a production order, etc.

43) Can you generate packing/picking lists for goods issue in SAP MM?

Ans:

In SAP EWM you can generate packing list.

44) What is a Scheduling agreement?

Ans:

Scheduling agreement is a long term outline agreement between vendor and ordering party over a predefined material or service which are procured on predetermined dates over a framework of time.

45) What is Quota Arrangement in SAP system?

Ans:

A particular material can be procured from different vendors depending upon the requirement. So, total requirement of a material is distributed to different vendor’s i.e. quota is assigned to each source of supply. This is known as quota arrangement.

46) How do you check Quota Rating?

Ans:

Quota rating = (Quota Allocated Quantity + Quota Base Quantity)/Quota

47) What is the use of Posting Period in SAP system?

Ans:

SAP ERP systems were designed so that business can be conducted in an efficient way. Various documents like purchase order, request for quotation, goods receipt are essential documents in a business. These documents need security i.e. if any of documents is posted incorrectly then business can be affected at various concern levels. So, to secure these documents we have a concept of posting period. Posting period means it will allow you to post and make changes in the documents only in a specific time period.

48) How do you define Posting Period in a company?

Ans:

Posting period for a company can be defined using five fields which are as follows −

• Maintain Fiscal Year Variant
• Assign Fiscal Year Variant to Company Code
• Define Variants for Open Posting Periods
• Assign Variant to Company Code
• Open and Close Posting Periods

49) What is the last step in Procurement cycle?

Ans:

• Invoice verification marks the end of procurement after purchase order and goods receipt.
• Invoice posting will update all related documents in financial and accounting.
• Blocked invoice that vary from actual invoice can be processed through invoice verification.

50) What are the integral components in SAP MM?

Ans:

The Components of SAP MM are listed below:

• Purchasing
• Inventory management
• Invoice verification
• Physical inventory
• Valuation
• Materials requirements planning
• Materials master
• Service master
• Foreign trade/customs

51) Mention t-code to create Purchase Requisition in MM?

Ans:

Transaction code ME51N can be used to create Purchase Requisition in MM

52) What are the various types of Basic Procurement?

Ans:

Basic procurement is of 2 types as listed below:

• Procurement for Stock vs Consumption
• External vs Internal Procurement

53) List few of the Common Stock Transport Order Movement Types?

Ans:

By utilizing MT 301, one step transfers of materials can be posted. The other different transport scenarios vary in the MTs by the good receipt and good Issues. Common Goods Issues may utilize MTs 303, 351, 641, or 643 in the STO. A STOs Good Receipt generally uses MT 101.

54) List the difference between SAP MDM and SAP MM?

Ans:

MM  (Material Management) is a module which deals with the day to day operations of inventory management (stuff related to material valuation, storage, requirement planning etc ) and Procurement processes ( is related to goods, receipt, Purchase orders BOMs etc).

MDM refers to Master Data management, It is business specific data, which encompasses information regarding vendor/customer names, Product descriptions, along with banking information.

55) What is Pricing procedure in MM?

Ans:

In the MM module, the Pricing procedure is a channel for determining the prices in purchasing documents. This give us functionality for assigning different calculation types for various needs. During PO and RFQ creation In MM module, the pricing procedure is utilized. The total value of material is based on all the addition and subtraction such as surcharge, discount, tax, freight, etc.

56) What are the steps needed to configure pricing procedure in SAP MM?

Ans:

• Maintaining Condition Table
• Maintaining Access Sequence
• Maintaining the Condition type
• Maintaining the Calculation Schema
• For the vendor, maintaining the Schema Group
• For Purchasing Organizations, maintaining the Schema Groups
• Assigning Schema Group to Purchasing Organization
• Maintaining Schema Determination
• Assigning Schema group to Vendor
• Maintaining condition record

57) What are the various steps involved in Procurement Cycle of SAP MM?

Ans:

• Determining the requirements of material
• Determining the source
• Selecting the vendor and Comparing the Quotations
• Purchase Order Processing
• Purchase Order Follow-Up
• Receiving Goods and managing Inventory
• Verifying the Invoice
• Payment to vendor

58) How can we post goods receipt?

Ans:

In T-Code: MIGO navigate to post Goods Receipt using the path given below −

Logistics -> Materials Management -> Inventory management -> Goods movement -> Goods movement

59) How can a user link a document to a vendor master record?

Ans:

By using the XK01 transaction code the user can successfully link the document with the vendor master record or by utilizing the following menu path:

SAP Menu -> Logistics -> Material Management -> Purchasing -> Master Data -> Vendor -> Central -> XK01-> Create.

60) What do you mean by Special stocks?

Ans:

Special stocks are all those stocks which are managed separately as they don’t belong to your company or these are stored at a specific location.

61) What are the various Special Procurement Types in SAP?

Ans:

Lister below the following special procurement types available in the SAP System:

• Consignment
• Subcontracting
• Stock transfer using stock transport order
• Third-Party Processing
• Returnable transport packaging
• Pipeline Handling

62) How would the user change unit of measures in mmr?

Ans:

Please follow the steps below:

• Go to mm02 t.code
• Enter your mat number
• Now select the over screen and then select basic data 1,
• Now you will find basic unit of measure which you can modify.

63) How can G/L Accounts for MM Account Determination be verified?

Ans:

The program RM07C030 verifies all the G/L account definition in your Material Master valuation class. User can Search it via Company code and Valuation area.

64) In Materials Management (MM), what is Data Archiving?

Ans:

Data archiving removes mass data which is no longer required by the system (but that still should be available for reporting) from the database. The SAP data archiving concept is typically based on the archiving objects of the Archive Development Kit (ADK).

65) Define Stock Population?

Ans:

The stock population is known as the total of all stock management units which are encompassed in an inventory sampling. All these stock management units are exclusively defined through the allocation of the stock management levels to a given inventory sampling. As a result of this, the stock population is also defined when the user allocates the level of the stock management.

66) How to make a Dummy Reservation?

Ans:

The user can try to create a new movement type with reference to 201 movement type.

67) How can the user include new custom field in Services tab for a Service PO item?

Ans:

The user can modify the description in the In the user field by customizing (SPRO) and appended a search help to it.

68) How to create movement type?

Ans:

Assume we are creating movement type 281 Goods issue for a network

Please follow the steps below:

• First, navigate to Transaction OMJJ
• Now the standard movement type 201
• Then click on copy and overwrite the 201 with 281
• Now click the Enter button, then click on Copy all
• Please select the new movement type 281
• Now On the left-hand column screen, click on Reversal/follow-on movement
• At last fill in the reversal movement type

69) What is RTP?

Ans:

RTP (Returnable Transport Packaging) is referred to a multi-trip packaging medium (for instance, containers or pallets) through which the goods can be transported multiple times between customers and vendors. Returnable transport packaging from a vendor which is stored at a place on your premises is treated as a special stock and is clearly assigned as a belonging to the vendor. RTP is vendor’s property, therefore, it is excluded from the customer’s valuated stock.

70) How can the user post returnable Transport Packaging (RTP) Quantities at Goods Receipt for Purchase Order?

Ans:

A quantity of returnable transport packaging can be entered at goods receipt for a purchase order, as listed below:

• In Inventory Management menu, navigate to Select -> Goods movement -> Goods receipt  -> For purchase order  -> PO number known  -> or  path PO number unknown.
• On the initial screen please enters the movement type (101) and also the order number (or the selection criteria for the purchase order).
• Now please select and copy the required items.
• Now in the overview screen, choose Edit -> W/o purchase order -> Enter.
• A popup window will appear, Please enter the movement type and the special stock indicator (e.g. 501 M ) for the quantity of returnable transport packaging.
• Now please enters the returnable transport packaging items.
• At last, post the goods movement.

71) How can you transfer Posting of RTP stock between Storage Locations?

Ans:

A transfer posting of RTP stock between two storage locations is entered as listed below:

• In Inventory Management menu, navigate to Goods movement -> Transfer posting -.  
• Now enter data to the initial screen:
• Now nvigate to Movement type Transfer posting  -> RTP stock  -> SLoc to SLoc  -> ( -> 311 M ->).  
• Now give the plant and the issuing storage location.
• Give vendor and the receiving storage location on the next screen.
• Please enter all the items.
• At last, post the goods movement.

72) What is the difference between the stock transfer between two plants belonging to same company code and those belonging to different company code?

Ans:

Stock Transfer Order (STO) for Intra Company

• The stock transfer between two plants are done with one Company code
• Purchase Order Type ‘UB’ is used in this case
• Delivery Type ‘NL’ is used
• Goods Movement type is 641 for Intra Company
• Item Category in delivery is NLN

Stock Transfer Purchase Order (STPO) for Intra Company

• Two Different Company Codes are required for Stock Transfer Purchase Orders between two plants
• Purchase Order Type ‘NB’ is used in this case
• Delivery Type ‘NLCC’ is used
• Goods Movement type is 643 for Inter-Company
• Item Category in delivery is NLC

73) WHAT IS SUB-CONTRACTING CYCLE IN MM?

Ans:

In Sub-contracting, we send raw material or input material to sub-contractor and then receive the finished goods. A sub-contracting PO is created with item category ‘L’. Input material is sent to vendor for processing with movement type 541. When GR is done using movement type 101, movement type 543 takes place automatically and takes care of consumed material.

74) WHAT IS THE DIFFERENCE BETWEEN CONTRACTS AND SCHEDULING AGREEMENTS?

Ans:

A contract is a pre-determined long term agreement to supply material or service for a certain period of time. Specific delivery dates are not mentioned in the contracts. Contracts can be of two types: Value Contract or Quantity contract

In Scheduling agreements, we can enter scheduling lines which gives details of quantity that should be delivered on specific date. Plant must be entered in SA so that materials can be delivered at plant. These are generally used for materials whose requirements are predictable.

75) WHAT IS MEANT BY BATCHES?

Ans:

A batch is a subset of the total stock of a material. It represents a homogeneous unit which has unique specification. Normally, a batch is assigned to the quantity of material produced during a given production run. A batch number uniqueness can be assigned at any of the following 3 levels:

At client level: The same batch number can be assigned only once within the entire client.

At material and plant combination level: Same batch number can be assigned to material with different specification in each plant.

At material number level: A batch assigned to a material has the same specification for all plants where material is extended. Batch number can be reassigned with a different specification for each material.

76) IF YOU HAVE A MULTI-LINEITEM PO, CAN YOU RELEASE THE PO ITEM BY ITEM?

Ans:

No, a PO is released at the header level meaning a total release or “With Classification”. PRs, on the other hand, have two release procedures possible. “With Classification” as described above, and “Without Classification” where it is only possible to release the PR item by item

77) WHAT IS A PRICE COMPARISON?

Ans:

Perform a price comparison using ME49 and one may compare quotations from different vendors.

78) WHAT IS A QUOTATION?

Ans:

Once a vendor has received an RFQ, the vendor will send back a quote that will be legally binding for a certain period of time. Specifically, a Quotation is an offer by a vendor to a purchasing organization regarding the supply of material(s) or performance of service(s) subject to specified conditions.

79) WHAT ARE THE DIFFERENT TYPES OF INVOICE VERIFICATION?

Ans:

Invoices based on Purchase Orders. With purchase-order-based Invoice Verification, all of the items of a purchase order can be settled together, regardless of whether or not an item has been received in several partial deliveries. All of the deliveries are totaled and posted as one item. Invoices based on Goods Receipts. With goods receipt-based Invoice Verification, each individual goods receipt is invoiced separately. Invoices without an order reference. When there is no reference to a PO, it is possible to post the transaction directly to a Material Account, a G/L Account, or an Asset Account. You can park Invoices that reference POs and GRs as well as Invoices with no reference in the system. When you park a document or change a parked document, neither substitution nor validation is supported.

80) WHAT IS THE USE OF ‘SPLIT VALUATION’?

Ans:

Within a valuation area, sometimes, we need to valuate various stocks of a material separately. It can be because of different origin, quality, status, etc. We use split valuation in such cases. In this case, material is managed at several partial stocks which are sub-stocks of main material stock. Any transaction, relevant for valuation, is carried at this partial stock level. In accounting view, we define if we need split valuation for any material.

81) HOW DO YOU SET ‘AUTOMATIC ACCOUNT ASSIGNMENT’ IN MM?

Ans:

Once OBYC settings are properly done, system finds the correct G/L account using the following data:

Chart of Accounts: Chart of Accounts is determined based on plant or company code used in transaction

Valuation Grouping Code: It is determined based on the valuation area. Valuation Grouping Code is maintained in t-code OMWD.

Transaction Key: eg. BSX, GBB etc. Transaction keys are determined automatically from the transaction (invoice verification) or the movement type (inventory management).

Account grouping /Account Modifier (only for offsetting entries, consignment liabilities, and price differences)

Valuation class of material or (in case of split valuation) the valuation type: The valuation class allows you to define automatic account determination that is dependent on the material. This can be achieved by assigning different valuation classes to the materials in material master (Accounting view) and by assigning different G/L accounts to the posting transaction for every valuation class.

82) WHAT IS A BUSINESS AREA?

Ans:

The business area is an organizational unit within financial accounting. It corresponds to a defined business segment or area of responsibility, to which value movements recorded in Financial Accounting can be assigned. It is usually derived automatically as it linked to other organizational units. For eg. Business area for a combination of plant and division is maintained by t-code OMJ7.

83) WHAT IS A COST CENTER?

Ans:

Cost Center accounting is used for controlling purposes. It is an organizational unit within a controlling area which represents a defined location of cost incurrence. For example, any department can be a cost center for recording all expenses incurred for that department.

84) WHAT IS A PROFIT CENTER?

Ans:

Profit Center Accounting evaluates the profit or loss of individual, independent areas within an organization. Profit center is an organizational unit in controlling to recognize your profit. Profit center is attached to material master at plant level.

85) HOW TO CREATE TAX CALCULATION PROCEDURE IN MM?

Ans:

Tax can be calculated for each line item of a PO separately based on the tax code. Earlier TAXINJ, which is a formula based tax procedure, was used. Now, TAXINN, which is a condition based tax procedure, is generally used. Tax procedure contains the condition type and necessary specification for each condition type. Account keys are assigned to condition types and these account keys determine the G/L to which the tax amount is to be posted(OB40). These account keys are maintained using t-code OBCN. (All these transactions are under Financial Accounting Global Settings Tax on Sales/Purchases Basic Settings). Tax codes are assigned to country codes and country are linked with tax procedure. Thus, based on tax code, corresponding tax procedure is determined and then calculation is done based on condition types in that tax procedure.

86) HOW IS SCRAP MATERIAL TAKEN CARE OF IN SUB-CONTRACTING?

Ans:

Scrap can be maintained in BOM as operational scrap, component scrap, By-Product or Co-Product. Common practice is to maintain scrap as by-product and receive it back along with processed material.

87) What is RFQ?

Ans:

RFQ is a Request for quotation. It is an invitation that is sent to sellers to submit quotes showing pricing and also terms and conditions. RFQ also has details regarding the date of delivery, goods and services, quantity, and date of submission also.

88) What do you mean by consumption-based planning (CBP)?

Ans:

Consumption-based planning or CBP is depended upon past consumption values. It is used to forecast to find out future requirements. These processes in CBP do not rely on the master production schedule. It is activated either when the stock level comes below a particular reorder point or when forecast needs calculating with past consumption values.

89) What is MIRO?

Ans:

MIRO means movement in receipt out. It deals with invoice verification activities in terms of bills that raised from the vendor’s end. MIRO is basically used by MIRO.

90) What is an RFI?

Ans:

RFI means a request for information. It is used for the business process that assembles written information about the competencies of sellers. 

91) What is an RFP?

Ans:

RFP means Request for Proposal. It is a document where a proposal is sent by a company or agency for the acquisition of some goods and services to any potential seller to send business proposals.

92) Which steps are used in the RFQ process?

Ans:

There are a number of steps used to process RFQ:

First, enter the t-code (transaction code) as ME41, then enter the RFQ type as ‘AN.’

After this, write down the location, i.e., the late date when the seller submits the quotation. Now, enter the purchasing group, delivery date, and other information, and press on the click button.

After this, you will be able to watch a new screen wherein you have to fill the item codes. Now enter the item codes and also the vendor’s details. 

Moreover, more requests can be made as per vendors’ details.

93) What is a goods receipt and post goods receipt?

Ans:

When the physical inbound transfer of material and goods are made into the warehouse is known as Goods receipt. It includes the transfer of those goods that have received from in-plant production or external vendors. Issuing of goods receipt always results in a hike in stock in the warehouse.

When the receipt of goods are posted with reference to the purchase order with which products or goods were ordered are known as a post-goods receipt. When the material is sent with reference to a purchase order, then all departments must make an entry in the system references.

94) How is the vendor created?

Ans:

You can create a vendor by using the transaction code XK01 and performing the following steps:

• Add the vendor name, company code, purchasing organization, account group, and vendor address.
• Add the country, bank key, bank account, and the name of the account holder.
• Save the data.
• This creates a vendor record in the system.

95) What data in material master is maintained at the client level?

Ans:

The general data, i.e., the data applicable to the company as a whole, is stored at the client level. ( apex training )

96) What is vendor master data?

Ans:

Vendor master data contains details of each vendor that supplies materials or services to an enterprise. The vendor master data is stored in individual vendor master records consisting of data, such as the vendor’s name, the vendor’s address, the currency used for the transaction, payment terms, and the contact person’s name (on the sales staff).

97) What are the different sections in vendor master data?

Ans:

Following are the three sections in vendor master data:

General data— Provides general information about the vendor that can be entered into the system for creating vendor records. General data can provide the name, address, telephone, and fax of the vendor through specified search terms. Additional information can also be added to the vendor master record by the accounting and purchasing departments using the transaction code XK01.

Accounting data —Refers to financial information entered at the company code level. The financial information includes tax information, bank details, reconciliation account, payment terms, payment methods, and dunning information. You can enter this financial data using the transaction code FK01.

Purchasing data —Refers to data entered while creating a vendor at the purchasing organization level. Different purchasing organizations have different purchasing data. The purchasing data includes partner functions, purchasing default fields, and invoice verification indicators. You can enter this data using the transaction code MK01.

98) What are the prerequisites for creating a purchasing info record?

Ans:

The prerequisites for creating a purchasing info record are as follows:

Material number —Before creating a purchasing info record, the material number of the material master record should be known.

Manufacturer part number (MPN) material number —Before ordering a material that has an MPN, you must know its MPN material number.

Vendor number —You should also know the number on the vendor master record.

99) What are the differences between company-owned special stocks and externally-owned special stocks?

Ans:

The differences between company-owned special stocks and externally-owned special stocks are listed in the following table:

Company-Owned Special Stocks

Externally-Owned Special Stocks

Stocks that belong to the company but are stored with the wholesaler or the customer are called company-owned special stocks.

Stocks that belong to the wholesaler or the customer but are stored at the company are called externally-owned special stocks.

Company-owned special stocks are managed at the production level.

Externally-owned special stocks are managed at the place where they are stored. ( data science online training ) 

Organizational level —If the purchasing info record is for a particular purchasing organization or plant, then the code specific to that purchasing organization or plant is required.

Part 5 :

1) What are the integral components in SAP MM?

The Components of SAP MM are listed below:

• Purchasing
• Inventory management
• Invoice verification
• Physical inventory
• Valuation
• Materials requirements planning
• Materials master
• Service master
• Foreign trade/customs

2) Mention t-code to create Purchase Requisition in MM?

Transaction code ME51N can be used to create Purchase Requisition in MM

3) What are the various types of Basic Procurement?

Basic procurement is of 2 types as listed below:

• Procurement for Stock vs Consumption
• External vs Internal Procurement

4) List few of the Common Stock Transport Order Movement Types?

By utilizing MT 301, one step transfers of materials can be posted. The other different transport scenarios vary in the MTs by the good receipt and good Issues. Common Goods Issues may utilize MTs 303, 351, 641, or 643 in the STO. A STOs Good Receipt generally uses MT 101.

5) What Is the difference between a Purchase requisition and a Purchase Order?

A Purchase Requisition is a type of document which notifies the need for services or materials, whereas a Purchase Order is a document type which is a more formal request for materials or services from a plant or an outside vendor. Procurement types can also be defined at the line item and can be either subcontracting, stock transfer, standard, consignment or an external service.

6) List the difference between SAP MDM and SAP MM?

MM  (Material Management) is a module which deals with the day to day operations of inventory management (stuff related to material valuation, storage, requirement planning etc ) and Procurement processes ( is related to goods, receipt, Purchase orders BOMs etc).

MDM refers to Master Data management, It is business specific data, which encompasses information regarding vendor/customer names, Product descriptions, along with banking information.

7) What is Pricing procedure in MM?

In the MM module, the Pricing procedure is a channel for determining the prices in purchasing documents. This give us functionality for assigning different calculation types for various needs. During PO and RFQ creation In MM module, the pricing procedure is utilized. The total value of material is based on all the addition and subtraction such as surcharge, discount, tax, freight, etc.

8) What are the steps needed to configure pricing procedure in SAP MM?

• Maintaining Condition Table
• Maintaining Access Sequence
• Maintaining the Condition type
• Maintaining the Calculation Schema
• For the vendor, maintaining the Schema Group
• For Purchasing Organizations, maintaining the Schema Groups
• Assigning Schema Group to Purchasing Organization
• Maintaining Schema Determination
• Assigning Schema group to Vendor
• Maintaining condition record

9) What are the various steps involved in Procurement Cycle of SAP MM?

• Determining the requirements of material
• Determining the source
• Selecting the vendor and Comparing the Quotations
• Purchase Order Processing
• Purchase Order Follow-Up
• Receiving Goods and managing Inventory
• Verifying the Invoice
• Payment to vendor

10) How can we post goods receipt?

In T-Code: MIGO navigate to post Goods Receipt using the path given below −

Logistics -> Materials Management -> Inventory management -> Goods movement -> Goods movement

11) How can a user link a document to a vendor master record?

By using the XK01 transaction code the user can successfully link the document with the vendor master record or by utilizing the following menu path:

SAP Menu -> Logistics -> Material Management -> Purchasing -> Master Data -> Vendor -> Central -> XK01-> Create.

12) What do you mean by Special stocks?

Special stocks are all those stocks which are managed separately as they don’t belong to your company or these are stored at a specific location.

13) What are the various Special Procurement Types in SAP?

Lister below the following special procurement types available in the SAP System:

• Consignment
• Subcontracting
• Stock transfer using stock transport order
• Third-Party Processing
• Returnable transport packaging
• Pipeline Handling

14) What is Consignment Stock?

SAP Consignment is defined as a process in which the user purchases the goods from a vendor, however, doesn’t valuate that stock. The user must make the payments to the vendor, only when goods are withdrawn from his store. Best example would be the Car shop which purchases the goods from its vendors for advertisement and display purposes and only once cars are sold, the vendor charges him.

The entire process of Consignment in SAP MM is managed by an item category in purchasing document and there are certain prerequisites/steps meant for the consignment process to work.

15) How would the user change unit of measures in mmr?

Please follow the steps below:

• Go to mm02 t.code
• Enter your mat number
• Now select the over screen and then select basic data 1,
• Now you will find basic unit of measure which you can modify.

16) How can G/L Accounts for MM Account Determination be verified?

The program RM07C030 verifies all the G/L account definition in your Material Master valuation class. User can Search it via Company code and Valuation area.

17) In Materials Management (MM), what is Data Archiving?

Data archiving removes mass data which is no longer required by the system (but that still should be available for reporting) from the database. The SAP data archiving concept is typically based on the archiving objects of the Archive Development Kit (ADK).

18) Define Stock Population?

The stock population is known as the total of all stock management units which are encompassed in an inventory sampling. All these stock management units are exclusively defined through the allocation of the stock management levels to a given inventory sampling. As a result of this, the stock population is also defined when the user allocates the level of the stock management.

19) How to make a Dummy Reservation?

The user can try to create a new movement type with reference to 201 movement type.

20) How can the user include new custom field in Services tab for a Service PO item?

The user can modify the description in the In the user field by customizing (SPRO) and appended a search help to it.

21) How to modify the Valuation Class in SAP MM?

User has to Go to t-code MMAM – This t-code is meant for altering the material type and not the valuation class.

If the user modifies the material type in MMAM transaction, then automatically the valuation class will be altered in the material master. The system will accept the changed material type valuation class which was initially created for that material type.

22) Is it possible to verify all the archive postings of a certain material?

Please try with MBAL – Archived Material Documents.

First, select the option Database table and then in the ‘Tables and Archiving Objects’ you are required to choose the second option ‘Tables from which data is archived’

23) Can we send a multilevel BOM to a Subcontractor in purchase order?

There is no feature available in the subcontracting to have multilevel BOM, we have two options

• First, is to attach the BOM as Document in the PO for the appropriate component
• The second option is to add the relevant component in same order with delivery to same vendor as a subcontractor with BOM.

24) What is subcontracting process?

Subcontracting is defined as one of the procurement processes available in MM. In this process, the components are shared with the vendor for getting the final product. The material which must be produced by the vendor can be ordered as a subcontract item in a purchase requisition, purchase order, or scheduling agreement. Each of the subcontract item has one or more sub-items which contains the individual components the vendor is required to perform the subcontract work or value-added service.

25) How will the user consider Subcontracting PO components which are not sent by my company to vendor however they are added by the vendor(subcontractor)?

We recommend you to get an updated invoice in which the cost of Nut Bolt and Gasket etc.  are all added. Thereby, you can either alter the PO price as per that price or make the invoice accordingly. By doing this the system will automatically update the Material/Product cost accordingly.

26) How to create movement type?

Assume we are creating movement type 281 Goods issue for a network

Please follow the steps below:

• First, navigate to Transaction OMJJ
• Now the standard movement type 201
• Then click on copy and overwrite the 201 with 281
• Now click the Enter button, then click on Copy all
• Please select the new movement type 281
• Now On the left-hand column screen, click on Reversal/follow-on movement
• At last fill in the reversal movement type

27) What is RTP?

RTP (Returnable Transport Packaging) is referred to a multi-trip packaging medium (for instance, containers or pallets) through which the goods can be transported multiple times between customers and vendors. Returnable transport packaging from a vendor which is stored at a place on your premises is treated as a special stock and is clearly assigned as a belonging to the vendor. RTP is vendor’s property, therefore, it is excluded from the customer’s valuated stock.

28) How can the user post returnable Transport Packaging (RTP) Quantities at Goods Receipt for Purchase Order?

A quantity of returnable transport packaging can be entered at goods receipt for a purchase order, as listed below:

• In Inventory Management menu, navigate to Select -> Goods movement -> Goods receipt  -> For purchase order  -> PO number known  -> or  path PO number unknown.
• On the initial screen please enters the movement type (101) and also the order number (or the selection criteria for the purchase order).
• Now please select and copy the required items.
• Now in the overview screen, choose Edit -> W/o purchase order -> Enter.
• A popup window will appear, Please enter the movement type and the special stock indicator (e.g. 501 M ) for the quantity of returnable transport packaging.
• Now please enters the returnable transport packaging items.
• At last, post the goods movement.

29) How can you transfer Posting of RTP stock between Storage Locations?

A transfer posting of RTP stock between two storage locations is entered as listed below:

• In Inventory Management menu, navigate to Goods movement -> Transfer posting -.  
• Now enter data to the initial screen:
• Now nvigate to Movement type Transfer posting  -> RTP stock  -> SLoc to SLoc  -> ( -> 311 M ->).  
• Now give the plant and the issuing storage location.
• Give vendor and the receiving storage location on the next screen.
• Please enter all the items.
• At last, post the goods movement.

30) What is the difference between the stock transfer between two plants belonging to same company code and those belonging to different company code?

Stock Transfer Order (STO) for Intra Company

• The stock transfer between two plants are done with one Company code
• Purchase Order Type ‘UB’ is used in this case
• Delivery Type ‘NL’ is used
• Goods Movement type is 641 for Intra Company
• Item Category in delivery is NLN

Stock Transfer Purchase Order (STPO) for Intra Company

• Two Different Company Codes are required for Stock Transfer Purchase Orders between two plants
• Purchase Order Type ‘NB’ is used in this case
• Delivery Type ‘NLCC’ is used
• Goods Movement type is 643 for Inter-Company
• Item Category in delivery is NLC