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Questions and Answers

What is the key that represents the buyer or group of buyers responsible for certain purchasing activities?

  • Vendor Evaluation
  • Purchasing Group (correct)
  • Purchasing Organization
  • Purchase Requisition

    • What is the smallest organizational unit for which you can maintain a legal set of books?

  • Company Code (correct)
  • Purchasing Group
  • Purchasing Organization
  • Vendor Evaluation

    • What is the purpose of a Purchase Requisition?

  • To formally request a vendor for a specific material or service
  • To create a balance sheet
  • To initiate the procure-to-pay process (correct)
  • To evaluate vendors for sourcing

    • What is the purpose of a Purchase Order?

    <p>To formally request a vendor for a specific material or service</p> Signup and view all the answers

    What is the purpose of Vendor Evaluation?

    <p>To evaluate vendors for sourcing</p> Signup and view all the answers

    What is the purpose of a Reconciliation Account?

    <p>To create a balance sheet at any time</p> Signup and view all the answers

    What is the purpose of a Quotation From Vendor?

    <p>To enter the vendor's response to a request for quotation</p> Signup and view all the answers

    What is the first step in the procure-to-pay process?

    <p>Purchase Requisition</p> Signup and view all the answers

    What is a Storage Location?

    <p>An organizational unit for differentiating material stocks</p> Signup and view all the answers

    What is the purpose of a Bill of Materials?

    <p>To serve as a basis for product costing</p> Signup and view all the answers

    What is a Scheduling Agreement?

    <p>A delivery schedule with line items and planned delivery dates</p> Signup and view all the answers

    What is Master Production Scheduling?

    <p>Planned at an aggregate level in time buckets</p> Signup and view all the answers

    What is Dynamic lot sizing?

    <p>A method for calculating lot sizes over multiple periods</p> Signup and view all the answers

    What is Independent Demand?

    <p>The original source of demand</p> Signup and view all the answers

    What is a Routing?

    <p>A template for production orders and run schedules</p> Signup and view all the answers

    What is a Production Order?

    <p>An integrated planning tool for batch-oriented process manufacturing</p> Signup and view all the answers

    What is the purpose of submitting a request for quotation to vendors?

    <p>To invite vendors to submit a bid for the supply of materials or services</p> Signup and view all the answers

    What is the difference between a quotation and a purchase vendor selection?

    <p>A quotation is a legally binding offer, while a purchase vendor selection is a formal request</p> Signup and view all the answers

    What is the purpose of an outline agreement?

    <p>To define prices and conditions for materials or services</p> Signup and view all the answers

    What is the function of a storage location in a plant?

    <p>To allow differentiation between various stocks of a material</p> Signup and view all the answers

    What is the purpose of a routing?

    <p>To serve as a template for production orders and run schedules</p> Signup and view all the answers

    What is the purpose of an availability check?

    <p>To determine whether the component, production resource tools, or capacities in an order are available</p> Signup and view all the answers

    What is the purpose of inventory management?

    <p>To manage stock on value or quantity basis</p> Signup and view all the answers

    What is the purpose of a purchase information record?

    <p>To be created manually or automatically</p> Signup and view all the answers

    Study Notes

    Procurement Process

    • An RFQ (Request for Quotation) is an invitation to a vendor to submit a bid for the supply of materials or services.
    • A quotation received from a vendor is a legally binding offer, containing prices and conditions for the materials specified in the RFQ for a predefined period of time.

    Quotation and Pricing

    • Buyers can perform Quotation Price Comparisons.
    • Contracts consist of items defining the individual materials, material groups, or services with prices.

    Inventory Management

    • Inventory Management deals with the management of stock, either on value or quantity basis.
    • Storage Location is an organizational unit allowing differentiation between the various stocks of a material in a plant.

    Purchasing Organization

    • A Purchase Organization is an organizational unit responsible for procuring services and materials.
    • The buying activity for a plant takes place at the Purchasing Organization.
    • Purchasing Information Record can be created manually.
    • Purchasing Group is the key that represents the buyer or group of buyers who are responsible for certain purchasing activities.

    Vendor Evaluation

    • Vendor Evaluation helps purchasing evaluate vendors for sourcing while also enabling the company to monitor vendor relationships through performance scores and criteria.

    Procure-to-Pay Process

    • The first step in the procure-to-pay process is Purchase Requisition.
    • Purchase Requisition is an internal document requesting the purchasing department to procure a specific good or service for a specified time.
    • A Purchase Order is a formal request to a vendor for a specific material or service under the stated conditions.

    Production Planning

    • Production Planning is an integrated planning tool for batch-oriented process manufacturing.
    • Routing is used as a template for production orders and run schedules.
    • Availability check is used to determine whether the component, production resource tools, or capacities in an order are available.
    • Sale and Operations Planning usually consists of three steps.
    • Accurate forecasts are not optional in the manufacturing sector.

    Production Processes

    • Scheduling Agreement is a total quantity of material spread over a certain period, consisting of line items indicating quantities and their planned delivery date.
    • Bill of Materials is used as a basis for product costing.
    • SAP divides production into multiple processes.
    • Variant bill of materials refers to several products with a large proportion of identical parts.
    • Shop Floor Documents are printed upon release of the Production Order.

    Master Production Scheduling

    • Master Production Scheduling is planned at an aggregate level in time buckets.
    • Dynamic calculates the optimum lot size for a several periods of net requirements.

    Sales and Operations Planning

    • Sales and Operations Planning information origination excludes Accounting.
    • Independent demand is the source of demand that resides at another level.

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