Exmail:Ramensh_chowdaryO3yahoo.com __Ramesh chowdary Mobile No: 9160004411 FI MM INTERACTION The MM Transactions which is related /impacting to Finance which need to update to the Fl Accounting. These transactions updates from MM to Fl through the integration between Fl and MM, M.M ORGANIZATION UNIT 1. Plant \ Storage location Plant: Plant is a place where the produce the material, where service provided, where we can store the Inventory and selling point can be called as a plant. > Plant is a place where the materials are produced (or) services are produced (or) storing the inventory (Depo) or warehouse. > PURPOSE OF PLANT: Valuation [- > VALUATION PURPOSE > The inventories can be valuated at the plant level. > we can have the different price at the different plants. Plant a Plant 2 HYD RAX 100 RMX 105(Bang) [Bn this case price can be maintain for the combination of material & plant JAccount determination at material per plant combination (Valuation class can be maintained at the material per plant combination) [— Costing data “The costing data can be maintained at the Material per plant leva} |—>tnventory mat “The inventories are managed at the plant level [re ta The MRP data can be maintain plant wise. Each plant has own MRP data (How you can procure material that will maintain in MRP) ” production data ‘+ The production data can be maintained at the plant level “—>Plant maintenance taskmail:pamensh_chowdaryo3yahoo.com Ramesh chowdary ‘Mobile No: 9160004411 ea Normally if we want to maintain any maintenance activities, the maintenance plant is requiring to perform the plant maintenance task. Each plant can have the maintenance data separately. STORAGE LOCATION: Nothing but inventory physically store that pl location (BIN) RM storage location jace called the storage PM storage location + Consumable storage location > SFG storage location FG storage location We can define N number of storage locations per plant. PURCHASE ORGANIZATION: Purchase organization is responsi externally > Allthe procurement activities performed at the purchase organization level |-—> Purchase info records ible to purchase the material | > purchase order creation |» pelivery (Goods received) L+ invoice (I) All these activities perform at the purchase organization level Ee: if we have purchase organizations for each location wise then we can maintain different purchasing data for the same vender also example different price and delivery conditions for each purchase organisation wise. fg: 1. Purchase organization 3 (Hyderabad), 2. Purchase organization 2 (Bangalore), we can do transactions separately for each organization wise > One company can have the multiple plants, But same plant not possible to assigitée tothe multiple Co. codes and Plant is a unige code, % One plant can be assign to one co. code only Co. coded Co. code 2 — A Plant 1 Plant? Sens Plant 4 \Z iN —_ pure: 6ret pure Ore 2 juinExmail:Ramensh chowdaryo3yahoo.com Ramesh chowdary Mobile No: 9160004411 SSS ————— SSS > Even though if not link plant to co. codes also we can transfr goods between different plants which belong to different co. codes > One plant can have the multiple purchase organization, One purchase organization can link to multiple plants. The same purchase organization can use to procure material for different plants, > Each plant can have multiple storage locations Eg: Plant 1 plant 2 VovoViy 4 RM PM SFG RM PM — SFG 1+ It grouping the similar attributes of materials and it controls the nurmber range and field Status of the material master. | Eg: RM, PM, Consumables, Spare parts, SFG, FG [> The material type it controls the field stocks of the material master. When we create material master there are so many fields available in the material master which can be controlled through the material type. | For the specific material type can be specified which material views allow to be used The material type it specifies, which view allow to be use for the specific material type Eg. Sales view, MRP view, Purchasing views, Quality views ,costing views, accounting views. We can control which views allow to be view through material type. 1 The material master can have the default values, ——> Material type controls the ho. range for material codification, MATERIALTYPE ‘ fovioRm p2z82 >5F6 "283 DFG > All the materials created under the material type. > Material type is required to create the material ACCOUNT CATEGORY REFERENCE Y It contains the list of valuation class. (Grouping of valuation class) >)i:Ramensh_chowdary03yahoo.com Ramesh chowtan/ Ema I “5 By using the Acct category, we can restrict which valuation class allow to be used for which material type. “> One Acct category reference can have multiple valuation class > One valuation class can link to the multiple acct category reference, > The valuation class can be assign to the material type through the acct category reference. “> By assigning acct category reference we can restrict which valuation class allow to be use for the specific material type. VALUATION CLASS: > The valuation class link to Acct category and account category further link to material type > It Represent the grouping of GL accounts\contains the list of GL accounts > The valuation class is the main link between material master and Fl account, (GL account) > Through the valuation class along which other parameter's which determines GL acct while posting inventory related tithsactions, good movement related transaction and also Invoice posting. HOW TO FINALISE THE VALUATION CLASS. Valuation class. 2yGL1-RM_Stock 781 >Rivlocl GL2— RM consumption 282 > RM-import G/L3- 33 > FGeternal GL >2B4 -> SFG-In house XN GLB- SFG Stock~ in house 25 FG GL9 ~SFG- consumption in house a <> G/LACCT 10~ FG STOCK. St A/C.11-COGM - FG G/LA/C 12~ COGS - FG One valuation class can have multiple G\t acct's, 5 ‘The Finalization of valuation class need to consider how we want post to GL accounts. {+}Exmail:Ramensh_chowdaryo3yahoo. Ramesh chowdary Mobile No: 9160004411 SE One material can have maximum one accent category reference. But the same account category reference can be assign to the multiple material types. During creation of material , we need to select material type and assign valuation class to the material master. Here we can able to select those valuation class which is assigned to combination of account category reference and material type The relevant GL accounts are determined based on the valuation class in the material master along with MM transaction types while posting the materials and invoice postings. Movement indicator +Movement type 1 Value string ‘Transaction key + general modifier Contain the possible (Tran’s key and general modifier) 4+ Itdetermines the Trans key and general modifier TRANSACTION KEY: Transaction key is a internal processing key which is used to determine G/L accounts y The transaction key specifies which G/L to be updated The transaction key (or) event keys can be used in account determination process to determine the G/L accounts while posting inventory and invoice postings. Transaction keys can be called as an internal processing key. This transaction key determine by SAP. If we want to post one document then minimum two transaction keys required. Each line time requires one transaction key. One posting line it present the one transaction key hence minimum two transaction keys require to post the document TRANSACTION KEYS BSX - Inventory posting (stock) .1t updates inventory. (This transaction key is used to update the B/S stock G/L account. WRK - GR/IR(Goods Received/inventory Received) This key trigged when we do external procurement. {>}E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary ‘Mobile No: 9150004411 Emaar one Eg: consumption-RM local G\L1 Consumption-RM import G\LL > One valuation class define one set of G\L accounts. Epi: RM procures local &import. If we want set G\L local and import differently than valuation class requires 2. Eg2: IF RM local import we want to show in one G\L then valuation class req. Lis enough. Purely how we want post to G\L accounts. Valuation class 7 RM local 281 RM “import 282 3 5 enteral 203 we “in house 284 FG 9 ————> Inhouse 265 Local Packing material < Import Consumables EXAMPLE FOR ACCT CATEGORY REFERENCE RM ‘Acct category 281 7B2-5FG [> 78209 " " i for SFG 783 7203-FG ly 7830" “ “ forFG ——> 286 > One material type can have one acct category only {5hchowdary03yahoo.com Ramesh chowdary _Mobile No: 9160004411 > Price (v) moving average price Price cantor (S)_= This moving avg price canbe recommendable to (5) Standard (s)Recommend for in house manufacturing product's production variance when it arrives rice (plan price! use for all external Procurement materials, Purchase price difference difference £ PO PRICE >> 100/- + 10 kg <100=1000/- AMX GRAI0KG (vy>100/- 10100-1000 & OUT OF 10k 2kg issue to production Dr Stock > 1000 BSx CrGR/JR > 1000 WRK Glto production Material consumption ->200 (GBB: VBR) stock > 200 (Bx) INVOICE RECEIVED AT THE RATE OF 105/- IR@105x10k.g=1050 When we receive invoice if any difference between IR and PO Then system check the stock available qty (Or) not. The difference between PO and Invoice=1000-105' Here stock available 8k.gs= 50x8k.g ——=-=40 (85x) 10kg Consumption stock 2kg SOx2kg 10{PRD) (Unavailable stock) 10kg {+}E-mail:Ramensh_chowdary03yahoo.com Ramesh clowdary __Mobile No: 9160004414 Se EN OSS 1) GR from vendor Both times GR/TR will trigger. 2)R from vendor > “WRX” is used to update the offset accounts of goods received from the external procurement and also it updates the invoice postings. > The "WRX" transaction key is used at the time of Goods receipt from vendor and also at the time of invoice receipt from the vendor. 1) GR from vendor to stock 218 from vendor Or Stock >8SX Dr GR/IR WRX Cr GR/IR >WRX Cr Vendor >KBS Price differences Purchase price variance in case of external procurement. Production variance (In case of in house manufacturing) PURCHASE PRICE DIFFERENCES Case 1(V) Case 2 (5) Inventory valuation 2 types, 4) Plan price method|std pfice}§ 2) Average method-VE-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 Dr GR/IR > 1000 > WRX Drstock> 40 > BSx Dr Price difference->10 >PRD Crvendor > 1050 KBs Case 3 Price control (S! % For external procurement ex: AMX 29 ‘S(5) 100 ‘\ RMY 10kg *110=1100: > In case of the price control (3) the inventory is always valuated with standard price (plan price) and it ignores the actual price. > The difference between actual price and plan price (standard price) will be charged to the price difference account ih case of the external procurement. It will be charged off to the production variance account. In case of in house manufacturing product (or) materials PO ‘> RMY > 40kg x110=1100 GR.10kg@110 > RMY () 100«10=1000 > 85x 1 10kg X100= 1000/- BSx 10kg X 10 = 100/- PRD Dr Stock >1000->85x Dr Price differ > 100 > PRD Cr GR/IR > 1100 >WRXxail: Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 INVOICE RECEIVED @115 The difference between PO and INVOCE it will charge or transfer to the price difference account Dr GR/IR> 1100 WRX Dr Price difference > 50 PRD Cr vendor > 1150 KBS IN HOUSE MANUFACTURING FGx > (8) 10000 _2P.cx10000=20000 PRODUCTION ORDER FOR FGX L. Aty > 2p.cs. MATERIAL CONSUMTION > 8000 L, RMX Activity cost > 10000 ToHe > S000. 23000 GR from production to stock with plan price-> 20000/- GR te PRODUCTION To stock —> DrStock ———> 20000 88x Cr COGM/factory out of production > 20000-> AUF f2Pcx10000= 20000) Production variance 3000 At the time of production order settlement, the order balance is transfer to the production variance account. { »}9160004411 E-mail:Ramensh_chowdary03yahoo.com DrFroduction variance. = ———________» PRD —> 3000 Cr COGM/ Factory output of the production > GBB AUF 3000 Normally the production variance should go to stock but here in this case we follows (S) standard price method so the production variance write off to product variance > The PRD transaction key is used to update the purchase price difference and also production variance ‘ "GBB": Offsetting entry for consumption of stock. The transaction key “GBB” can be used for multiple transactions while consuming material like for goods issue to the production orders, GI to the"cost cénters, to post the physical inventory differences, scrapping of the materials, goods delivers to'the customer initial upload of the stock. > Especially used for consumption of the materials Goods issue to the production order: 261 Dr Material consumption > GBB -VBR Cr Stock > Bsx Goods issue to the cost centre /project Or Material consumption >GBB-VBR Cr Stock >BSX Goods issue to the sub contract vendor Dr Material consumption >GBB-VBO Cr stock > BSxK Scrapping of the material Dr Material consumption >GBB Cr stock >Bsx Goods delivery to the customer 601 {=}E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 Dr coGs >GUB-VAX/VAY Cr stock >Bsx BSV-CHANGE IN STOCK ACCOUNT > This is especially used in subcontract process. > This transaction key is used in the subcontract scenario ,it updates the change in stock G/L account at the time of Goods received from subcontract VendoF to the stock. Dr Stock > BSx Cr Change in Stock > GBB-BSV FRL- EXTERNAL ACTIVITY (SUBCONTRACTING CHARGES/PROCESS CHARGES) > This transaction key is used to account the process charges at the time of goods received from subcontract vendor to the stock ‘SUB CONTRACT PROCESS > Some components send to sub contract todo some process of product and vendor will charge sub contract charge a > At the time of Goods issue to the sub contract vendor. Just system transfers the stock to the reserve stock. [>No Fl entry will generate, >The Fl entry generates at the time of Goods received from the sub contract vendor to the stock, GR-FROM SUB CONTRACT VENDOR TO THE STOCK > Material consumption (Sr Material consumption GBB Cr Stock Bsx | sprocess charges (sub contract) ("5 br sub contract charges/ Process charges FRL Cr GRAR Account WRX Goods received for component (sub contract) [> br Stock BSx 2E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 eee — SS —> Cr change in Account 8SV “UMB" Gain (or) loss from revalution of entry SUBCONTRACT SFGX> 8000 >Rmx| «1000 SUBCONTROCT >|RMy} x 2000 ‘4 HROCSS CHARGEx 5000 NOENTRY [___, pr mat Consumtion > Rix x 1000 RMY x 2000 Cr Stock > RMX > 1000 RMY-> 2000 “UMB" Gain (01 1m revalution on inventor; Eg: Fox te. 8) 10,000 10 p.c = 1,00,000 Today's price 12,000 10 p.c =1, 20,000 (Increase) (The price change) _ Gain on revolution of inventory 20000 — Standard cost estimate release price updation to the material master (or) manual change. Dr Stock 20,000 esx {=}I:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 Cr Gain on revalution 20,000 UMB > The price difference happens when standard cost estimation release. The price will update in material master and also at time of price change manually. Dr/Cr stock 20,000 BSK ume Cr/Dr Gain/loss on revalu: > This transaction key it updates to the Gain/loss of the account: during the revaluation of inventory. > This transaction key is used during the standard cost/estimate release and also. During the manual price changes of the material. If stock is available. “AUM" GAIN/LOSS STOCK TRANSFER FROM THE PLANT TO ANOTHER PLANT Plant -1 plant-2 SFGX x 19P.C =1000 SFGX (5) 100x2P.c=200 (5) 110 800 Stock transfer 2p Dr Stoel 2jic 216 = 220 BSX Receiving plant Cr.Gaion stock transfer to 20- AUM Cr stack 2p¢ 100 = 200 BSx Sending plant > This transaction key is used during the stock transfer (or) material transfer from one plant to another plant, > The system it generates the Gain/Loss on stock transfer if any price difference between the sending plant & receiving plant. { « }E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 “KOM” EXCHANGE RATE DIFFERENCES > We can treat differently for the exchange rate difference. > We can treat exchange rate differences in two ways If any exchange rate difference at the time of purchase order and invoice 1) Can be charges on inventory 2) Transfer to separate exchange rate difference account The settings can be done in MM and will take care by MM team. The second option we can treat that exchange rate separately. » Exchange rate difference is the difference between the exchange rate at the time of purchase order & invoice. The difference can be treated as exchanger rate difference The exchange difference treatment can be done 2 ways. 4) Loadings on inventory _—_2) Transfer to exchange rate difference account > Most cases we are going to transfer to the inventory > Ife have material , the difference will be loaded on the inventory. Eg: Case 1 (Availability of Full stock) Purchase order [>1pc 100 USD (Exchange rate @ 60 46000) GR: Dr Stock @ 60 x100 = 6000 CrGR/IR = 6000 IR Dr GR/IR-> 6000. WRX Dr Stock 1000 BSx Cr vendor @ 100 x 70 = 7000 KBS Case 2 Dr GR/IR 6000 - WRX Dr Exchange rate difference 1000 - KOM [Cr vendor->7000 - KBS > “KOM" transaction key is used to account the exchange rate difference if any ( exchange rate difference between Purchase order and invoice) FRI Freight clearing FR2 Freight clearing {35}‘amensh_chowdary03yahoo.com Ramesh chowdary ‘Mobile No: 9160004411 FR3-> Customs clearing FR4~> Customs provisions Some of the transactions update with multiple transaction keys. Transaction Key-> “GBB” Goods issued to production order Dr Material consumption > GBB-VBR Cr stock > asx Material scrap Dr Material consumption > GBB-VNG Cr stock > BSx Physical inventory differences Dr Physical inventory differences GBB-INV Crstock > BSx Goods deliver to customer Dr COGS > GBB-VAX / VAY Cr stock > BSX GENERAL MODIFIER Further classification of transaction keys can be called as General modifier. Gee PRD CON > The general modifier can be used only for the transaction key GBB, PRD and CON. > We can post to the different G/L account by using the general modifier for the same transaction key. "VBR" - Internal Consumption This transaction key is used while issuing the goods to the production order and cost centre and order. In this case used GBB-VBR. “VNG" - Scrap of the material (GBB-VNG ‘GBB-INV" Physical inventory difference "GBB-VQP- Goods issue to the sample { « )E-mail:Ramensh_chowdary3yahoo.com Ramesh chowdary Mobile No: 9160004411 Dr Material consumption -> GBB-VQP >] Crstock > BSx > Goods received from production to stock (AUF-COGM/Factory output of production! {ar stock> 85x Cr COGM > GBB-AUF Goods delivery to the customer Dr COGS > GBB-VAX ( COGS without cost element) Cr stock >BSx TAS GBB-VAX > COGS without cost element . GBB-VAY > COGS with cost element’ Make to order - GB8-VAY (with cost element) where sales order is a cost object Make to Stock scenario - VAX without cost element SUB CONTRACT Dr Material consumption -RM (G1 tolthe sub contract) GB8-VBO 4 Do not create cost element Cr stock (RM) Dr Process change >FRL bo not create cost element Cr GR/IR > WRX Dr Stock SFG ->8Sx Cr change in stock SFG > BSV RD. ‘Blank > Purchase price difference > PRF > Production variance { »E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary T DrGR/IR_- > WRX Dr stock > BSX Dr Purchase price difference > PRO-Blank Crvendor > KBS case 2 Fox “sproduction variance settlement Dr Production variance > PRD-PRF Cr COGM GBB -AUF > General modifier - we can define our own general modifier in addition to the SAP define general modifier. (mm consultant will define) MOVEMENT TYPES It represents the type of materia] movetnent. Eg: Good issue to production GR issue from production Goods transfer to other locations > When matérial movement we need to specify the movement type, the Good's movement happen based on the movement type > It determines the predefined posting rules. > The posting rule it specify which financial account to be updated i.e which consumption and inventory accounts to be updated. How system know which Acct to be updated. > The movement type it determine the relevant transaction key and general modifier’s to determine G\L accounts. > The movement type specifies weather to updated inventory field (or) not nothing but stock. > We can use the SAP defined movement type’s we can also define own movement type in case standard movement type not sufficient. {=}E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 MOVEMENT TYPE “101” joods received The”101” movement type is used while GR from vendor to stock and while GR from production to stock. (101) MOVEMENT TYPE ;->GBB }28sx Value string i>wey possible transaction key +General modifier Lypro Value string Contains the list of the transaction keys possible for the specific movement type With Reference to (po) Purchase.order 7 om vendor stock (101) Dr Stock > BSx Cr GR/IR> WRX With Reference to production order. a 2) GR From produttion to stock (101) Dr Stock > asx cr cOGM > Gee - AUF MOVEMENT INDICATOR Movement indicator can be called as a type of the document. > With combination of movement indicator & movement type, system determine the type of the transaction Purchase order, production order , Sales order delivery document. > By using the movement indicator we can differentiate the type of the transaction like purchase order, production order and delivery document. Eg: Receiving Goods from vendor to stock which refer to (PO) Eg: Receiving Goods from product to stock with refer to production order +}E-mail:Ramensh_chowdary3yahoo.com Ramesh chowdary Mobile No: 9160004411 > Movement type .1long with movement Indicator it determines the transaction key, while posting the transaction. Movement Indicator Movement type | Po ror | [> 8sx ‘> WRX | PRODUCTION ORDER +101 | [>Bsx 688 > With help of movement type and. movement indicator we can trigger exact transaction keys and further it triggers relevant account. Goods issue to the production order (261) Dr Material consumption > GBB ~ VBR Cr stock > BSx Goolls issues tothe costenter (201) DF Material consumption > GBB - VBR Cr stock > BSX Goods deliver to the customer 601) Dr coGs > GBB ~ VAX /VAY Cr stock > BSx Initial stock uploads (561) Bringing stock from non-SAP to SAP Dr Stock > BSX Cr Initial balance upload > GBB - BSA { » }Ramesh chowdary ‘Mobile No: 9160004411 IMP Goods issue tothe project (224) Or Material consumption > GBB - VBR Cr Stock > Bsx SCRAP (551) Dr Material consumption- scrap > GBB- VNG Crstock > BSx GOD'S ISSUE TO THE SUB CONTRACT VENDOR (541) No Fl entry just it transfer the stock from the common stack to the reserve stock. Stock lying at sub contract vendor (stock sent to sub contract vendor), GOOD’S RECEIVED FROM SUB CONTRACT VENDOR (543) Dr RM Consumption > GBB -VBO Cr stock > BsK Dr Process charges. > FRL crGR/IR > wrx Dr stock > BSx Cr change in stock > BSY MOVEMENT INDICATOR +MOVEMENT TYPE Vaule string 44+ Transaction keys "> It determine Trans key and general modifier, > The movement type along with movement indicator system determines the specific transaction key and general modifiers to update the G\ accounts. OBYC SETTINGS (FI- MM INTERATION) VALUTION AREA | TRANSACTION __| GENRAL VOLUTION CLASS | G/L ACCOUNT {>}Ramesh chowdary Mobile No: 9160004414 GRP Key MODIFIER Bsx : z1 G/L-RM LOCAL BSx ze2 G/L- RM IMPORT __|wex : ze1 G/t3 -GR/IR WRX : 782 oa." GBB ver 71 G/Latmateriat consumption focal) GBB VBR 782 G/La(Material consumption ~ _ import) ( | | movemenr nos movemenr ree \ | MATERIAL TYPE | in VaIUEsTRNG mmatlaats ACCT cATEGARY Ret 1 Ob rans KEY+G.M or VALUTION CLASS oBYC (FI- MM) By using valuation grp we can grp multiple which need to be apply the same account determination. va NLEVEL, > Valuation level: It specifies at what level inventory to be evaluated. 1)Co.codelevel 2) Plant level {> ]E-mail:Ramensh_chowdary03yahoo.com Romesh chowdary We cannot activate or deactivate valuation level after posting the transactions We recommend to use valuation level is at plant level CO. CODE LEVEL: PLANT LEVEL Different price not possible to maintain for the same material across the plant. Same price maintained for the material across the plants within the co. Code. CO.coDE 1 cO.coDE 2 Plant 1 plant 2 RMX RMX (v} 100 (v) 100 Both same prices should maintained and different price not possible for different plants, > Possible to maintain different price for the combination of material per plant. cO.CODE Plant plant 2 RMX (Vv) 100 RMY (v) 120 We can maintain different price for the combination of Material/plant/batch combination. > Valuation level specifies at what level the inventory prices to be maintain in m.m. valuation level activation at the client level > We havethe 2 options. 1) Co. code level 2) Plant level Once activating the valuation level and it’s not possible to change the valuation level. IF THE VALUATION LEVEL EQUAL TO PLANT: In this case system it allows to maintain different prices for the combination of material and plant (or) material, batch and plant combination.Ramesh chowdary Mobile No: 9160004411 IF THE VALUATION LEVEL EQUAL TO CO.CODELEVEL In this case system it allows to maintain same price, for specific material across the plant within the co. Code. At what level we want to valuate inventory either at co, code (or) plant that we need to decide. Valuation area Valuation area it determines the material valuation postings. Valuation level determines valuation area. If the valuation level = co. Code then valuation area = co. Code. ye Valuation level = plant then valuation area = plant. CO. CODE THEN VALUATION AREA = CO. CODE In this case all the plant stock of the material with in a co. Code is valuated at the same price. IF THE VALUATION LEVEL IF VALUATION LEVEL = PLANT LEVEL THEN VALUATION AREA = PLANT In this case the material stock for each plant iS.valuated separately, In this case we can maintain different price foreach combination of material and plant combination (or) material, batch, and plant combination (or) material, valuation type, and plant combination, (Material split valuation) VALUATION CONTROL (_sthese valuation controls specify whether valuation, area is relevant for Account determination (or) not. (by usually default all are relevant for Account determination) CREATION OF PLANT IMG-> Enterprise structure ->Definition-> Logistics general~>Define copy, delete, and check the plant Y. Click on copy From plant |_ 100° To plant |” 5100 MSG YES, Do you want to transport no ranges? BACK - NAME PLANT HYD.E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 Y Double on | 6200 | Y Click on address tab Y- Maintain plant address Y Click on Nt Y Plant 8200 ¥ Name | puawr-eane Y Factory calendar Y Click on change address button Y Maintain address DEFINE THE STORAGE LOCATION IMG Enterprise >Definition>Material Management > Maintain the storage location. Plant {6100 | New Entries DESCRIPTION =O) If want we can maintain storage location. Y Click on storage location ¥ Plant | 5200 {5}E-mail:Ramensh_chowdary3yahoo.com Ramesh chowdary Mobile No: 9160004411 Y Click on new entries STORAGE LOCATION DESCRIPTION _ ___10 RM i - SFG - _| a £6 _ DEFINE THE PURCHASE ORGANIZATION IMG Enterprise purchase organization Glick on new entries structure>Definition> Material management> Maintain PUR. ORGANIZATION PUR.ORG.DESCRIPATION | a B10 7 PUR.ORG.HYD B20 ak PUR.ORG.BLR ASSIGN PLANT TO CO.CODE IMG > Enterprise structure, > Assignment > Logistic general Assign plant to co. Code. Click on new entries. B100 co. Code copies with 1000 co. Code plant 80 it’s assign to 1000 co, Code. Select co. Code 1000 plant 8100. Click on delete. { » }E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 ASSIGN THE PURCHASE ORGANIZATION TO THE CO, CODE IMG Enterprise Assignment->Material management Assign purchase organization to co. Code. PUR.ORG | co.coDE | Bio - L BAOL L B20 { BAOL > Purchase organization we can link to plant directly ASSIGN THE PURCHASE ORGANIZATION TO THE PLANT Click on new entries PO.ORG | PLANT | B10 hoe 8100 B20 ed 8100 | 8200 l 8200 We can assign the multiple purchase organization to single plant. DEFINE ATTRIBUTES OF MATERIAL TYPE, IMG-> Logistic general Material master->Basic settings->Material type>Define the attributes of material type Definition of material typeE-mail jamensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 SAP DEFINED MATERIAL TYPES ROH - Raw materials HALB - SFG FERT - Finished goods DIEN - Service ERSA - Spare parts HAWA - Trading goods KMAT - Configurable material ‘VERP - Packing material DEFINE RM TYPE Y Select{ROH Y lick on copy Y Material type | gam | | RAW MATERIAL BAXXX | @ External no assignment 1 with QTY STR 4 If activator IND external no. If not activate internal view. > Which view allow to use Y Accounting MRP Purchasing Costing Basic data © Storage Plant costs storage location KRSNA KK These all views we will get in material master. Extermmatpurchase order [2] External purchase order allow Internal purchase order [0] No inter purchase order allow. If we want we can put. Price MOVING AVG PRICE PERIODIC PRICE Which default price control © Price control mandatoryE-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary ‘Mobile No: 9160004411 PRICE CONTROL: if the indicator is activated then the default price control not possible to change in the material master. Enter and save. Y Select material type BRM Y Click on Qty (or) value updating Y Select the plant & material type VAL AREA, gry | VALUE UPDATE B100 Yn “ B200 - mee 2 Mandatory to update Qty and value updation Y Click on material type ¥ Select material type HALE] Y Glickon copy | SFG ~BA Xx Materialtype | 8S°6 | {L_s86—Ba x J with Qty STR Whenever we create material default update, USER DEPT Work schedule + Sales Accounting + Plant stocks MRP. = Storage location stock Purchase Costing Basic data Storage SANK 808 External purchase order[ 1 | allow warning Internal purchase order] allow Price control [standard price) Material master level we can over write { » }E-mail:Ramens Mobile No: 9160004411 showdary03yahoo.com Price control mandatory If we don’t want overwrite we need to activate If we want overwrite no need to activate Enter save Y Select material type Y Click on material type Click on Qty/Value updation Valuation area { |___MAT TYPE QTYUPDATE VAL UPDATION | | BseG v - v | BSFG [vt vo ¥ Select material type [FER] Y Click on copy a 1 Y Materialtype { prc | | FINISHED GOOD'SBOxx | Item category grp & with qty STR % External no ¢ Work schedule Accounting RP Costing Basic data Storage Sales Plant stock Storage location stock KKK K KAAS External order O Internal orderRamesh chowdary > Select material type > Click on Qty and value updation Mobile No: 9160004411 VAL AREA MAT TYPE QTY ALLOW VALUE ] B100 8FG ¥ Yo B200 BFG v % ev MAINTAIN CO. CODE FOR MATERIAL MANAGEMENT jos IMG ~>Logistic general Material master-> Basic setting->Maintain the co. Code for material management > Select co. Code (AOI) | co.cope | YEAR | PERIOD LAST MONTH | OF PREVS | FY | - - a Se | — 5 | | 5 | a ABP: Allow Block Posting Normally in real time, It will allowed first two working days Month end close > System allow to post immediate previous period {»}E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary ‘Mobile No: 9160004411 DBP DISALLOW BLOCK POSTING AFTER CHANGE OF PERIOD If the indicator is activated then not possible post to the previous closed period. > Enter one either ABP (or) DBP DEFINE PLANT PARAMETERS IMG Material management>Inventory management and physical inventory Plant parameters Y Click on plant parameters Y Select the [00d plant Y Click on copy v Plant [B200| SET TOLERANCE LIMIT IMG->Material_management->inventory management. and physical inventory>Set tolerance limit Click on tolerance limit Select 81, 82, VP. Co. Code 1000 Click on copy _T. Key [83] Co. code Adil KANN ©Do not check. All T. Key [62] Co. code [BAdA] Do not check. All T. Key [vp] Co. code SET THE TOLERENCE LIMIT FOR PRICE VARIANCE IMG Material management->Purchasing-> Purchase order->Set tolerance limit for price variance ¥ Select co. Code 1000 PE (price variance) Y Select co. Code 1000 SE (price variance) Do not check. All {2}E-mail:Ramensh_chowdaryO3yahoo.com Ramesh chowdary Mobile No: 9160004411 Y Click on copy T. Key [PE] Co. code [ba0i] Do not check. All 1. key [39 Co. code [BAOi] @Do not check. All SET THE TOLERANCE LIMIT FOR INVOICE VERIFICATION IMG Material management->Logistic invoice verification-> Invoice Block->set the tolerance limit Y Select co. Code (£009) 7. Key P.P Y Click on copy T. Key PP Co. code [BA03) ©Do not check, Allo», SET THE AUTOMATIC STATUS CHANGE IMG Material management-> Logistic invoice verification->Invoice verification in background Define automatic status change > Click on new entries | CO.CODE SET CUR INV TO COMPLETED | __SET CUR INV TO ee | MAINTAIN THE DEFAULT VALUES FOR TAX CODE ‘Where the Invoice not relevant for tax and post entry related to Tax related G/L. 'MG->Logistic invoice verification>incoming Invoices->Maintain the default values for tax codes + Click on new entries { =)E-mail:Ramensh_chowdary03 yahoo.com Ramesh chowdary Mobile No: 9160004411 eee eS == Co.cade AOI] | ABCLTO Tax code [VO] DEFAULT VALUE UNPLANNED TAX CODE Tax code VO] DEFINE THE VALUATION CONTROL IMG Material management->Valution&Account assignméfit> Account determination>Account determination without wizard-> Define valuation control ® Valuation group code active . Valuation group code is used to map and determine the different GL accounts based on the plant. PLANTS * Valuation grp code can be\assign plant transactions key +valuation cass | [ |, > One acct determination 5 a 5 ——> One acct determination ' 6 ' The purpose that to group the plants for which is required similar account determination ‘then we can use the valuation group code. We need to activate the valuation group code to use the concept of valuation group code.E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 SaaS GROUP TOGETHER VALUION AREAS IMG> Material management->Valuation & Assignment Account determination>Account determination without wizard->Group together valuation areas. Val area Valution erp code 8100 Bi 8200 82 If we want to group the plants for account determination. By using valuation group code we are grouping plants for account determination. Select the valuation area Normally we will keep blank valuation grp code where you want to apply same account determination irrespective of plants, DEFINE THE CATEGORY REFERENCE nis DESCRITION ACR FOR RM ~ BAXX_ -—2 [ACR FOR SFG - BAXX ACR FOR FG ~ BAXX DEFINE THE VALUATION CLASS Define valuation class with reference to account categoryRamesh chowdary Mobile No: 9160004411 DESCRIPTION RM ~10 Cat RM — IMPORT, SFG ~ Ext local SFG — Ext import SFG-INHOUSE FG ~ IN HOUSE J ASSIGN THE ACCOUNT CATEGORY REFERENCE TO THE MATERIAL TYPE (One account category reference can link to the multiple material types. Weave Cat slis CHECK THE MOVEMENT TYPE DEFINI om IMG Material management inventory management & physical inventory->Movement types->Copy, change, movement type. W Movement type Moversient type from To [399 Select movement type D. Click (103 "Ss" - Debit “HW” - Credit > Click on Acct grouping > Here we can observe the value string > In this step we can analyse the assignment of possible trans key, General modifier, value string, movement indicator to the movement type, {3}E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary > We can analyse movement Indica ‘or MOVEMENT INDICATOR Valstr Tra. Key A/C modifier GM 8-Goods movement for Pur-order F-Goods movement for pro -order WFOL- PRO PRE N-Goods movement for delivery-Note MOVE TYPE MOV IND 101 8 Goods movement for pur.order WEOL PRD PRE 101 F Goods movement for pro.order-stock WFO1 GBB—AUF FI MM INTEGRATION [OBYG MM-path IMG->Materials management>Valuation & Account determination> Account determination without wizard (on figure Automatic postings) Y Click on fancell Y Click on Acct Assignment (Or) FIPATH IMG> FA (new) >General ledger Account (new) > Periodic processing > Integration material's management-> Define the Account’s for material's management. CREATION OF INVENTORY G\L'S |FSOO| 1, G\tB1007% LT RM. STOCK-ocal @a/s Tax category’ © tina item FSG “(6006 —————> MPost Automatically ——> 2.G/t 10073] LT RM —~[TOCK= IMPORT, @a/s {» }E-mailiRamensh_chowdary03yahoo.com Ramesh chowdary __ Mobile No: 9160004411 _ 3.G/t f110008| Fs [Go4! @B/s GL Post Automatically st [6R/ AR] Save © Only Balance in local car Tax category [X] Posting w/o tax allowed open item management ine item display 4,G/L Account [100014 € {tooo7 CE category bal FINE RMC p" -IMPORT 1. 6\t s [iM.consumption Impord Click on cost element ce frooo7 CE Category [03] 2.6\t_ ftooo73] 5.7 |RM.consumption ImportE-mail:Ramensh_chowdaryO3yaho Click on cost element c.é ftooo7s] Ce Category fil OBYC MAPPING Tcode Excel: GR\from vendor to stock MIGO] Movement type [103] 101 T.key Gene modifier valclass GLAC DrRM-stock-local 8X 781 310070 Or RM-stock-Import _BSX 282 310071 CrGR\IR wax “281 410008 CraR\in wrx 782 410008 SAP Select transaction key [BSX] inventory posting, Double click BX >. con BoP] Valuation modifier 2 Valuation class = aaa VALUTION VALUTION CLASS G/Lacct MooiFicr a ze1 310070 81 2B2 310071 | 82 zB1 310070 82 |z82 310071 Val modifier not required for the above case as maintained the same G/L accounts for all the plants. {»}Ramesh chowdary Back Select transaction key WRX Double click Valuation modifier Valuation class Valuation modifier = Valution grp code, (or) valuation area grp code. INVOICE VERIFICATION MIRO. Case‘: THERE IS NO PRICE DIFFERENCE BETWEEN PURCHASE ORDER AND INVOICE. Val.class G\e Dr GR\IR RM-local ——> WRX ze1 GR\IR Dr GR\IR RM-Import ——> WRX 782 GRAIR Cr Vendor > kes Case2: IF THE PRICE DIFFERENCE BETWEEN PO & INVOICE AND FULL STOCK 1S AVAILABLE. val.class Dr\Cr RM-Stock -local BSx zB1 310070 Dr\Cr RM-Stock-Import BSx 782 310071 Dr GRR wax 281 410008 Dr GRR wrx 781 410008 Cr Vendor kes A\PGL Case3 : IF THE PRICE DIFFERENCE BETWEEN PO & INVOICE AND STOCK AVAILABLE-> MIRO T.key Gen.modifier val.class co Dr\Cr Price difference{RM-local) PRO Blank zeL 100010 Dr\cr-c.c Dr\Cr Price difference (RM-import) PRD Blank 7zB1 100010 Dr\Cr-c.c Dr — GR\IR-local WRX 281 410008 Dr GRYIR-Amport wrx zB1 410008 ce Vendor KBs zB. A\P GLE-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary ‘Mobile No: 9160004411 Ee Stock update ____Pgpduct Costing (PC) 4 100/- 100/- o.n\wethod Pdrice Invoice 1 C3 100/- 7 To =10/- pur price diff Go TO oBYC Select the transaction key PRD on/pRo} General modifier 4 Valuation “ Valuation class VALUTION GENERAL vawution class | ACCOUNT MODIFIER Movetrier B1 ___| ze1 100010 Bl - 782 __| 100010 82 a zB 100010 | B2 _ 262 100010 Case4: IF THE PRICE DIFFERENCE BETWEEN PO & INVOICE & PARTIAL STOCK AVAILABLE Tkey G.modifier Val.class Cost center Dr\Cr RM - Stock - locat Bsy zB, Dr\Cr RM - Stock - Import 85x zB2 Dr\Cr Price difference (RM-local) PRD Blank zB Dr\crc.c {#)E-mail jamensh_chowdary03yahoo.com Ramesh chowdary Or\cr price difference (RM-Import) PRD Blank 282 Or\crc.c Dr GRR WRX zt Dr GRVIR wrx 22 Dr Vendor KBs Movement type ISSUE MATERIAL TO THE COST CENTRE —_[iGo|(201 Tkey G.Midifier Vallass G/L Coventry Dr Rm-Stock-local GBB VBR 781 100070 ,Br/€r Cc Dr Rm-Consumption-Import Gee veR 762 40071 r/cre.c Cr Rm-Local sx 761 310070 Cr Rm-Local asx zp2 310071 Go To oBYc > Click transaction key (GBB) yalyation General Valelass A/C > Sasa « ‘Modifier: _ modifer Valuation modifi vation meaner 81 ver 71 100070 General modifier Bt ver ze2 100071 eave VBR zB1 310070 > Click on Account ar 82 VaR ze2 310071 MATERIAL MASTER M.M MMis the central repository. It contains the data which relevant to the all the modules. ike: Accounting, Costing, Materials management, production and sales modules ete. > Itis not only related to the one module. > Inthe MM, same tabs using for accounting & costing purpose like we are using the MRP, accounting, costing tab, etc., > Each tab represents one module. Some tabs represent multiple modules, Bascict, Basic2 tabs contains common information & generic information. Purchase > Procurement MRP tap > Prod, sales, material management, costing modules A/C1,A/C2 A/C for financial module &co module {=}E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 Costing > Costing purpose Sales view > Quality view> > > > Material management Material code: Internal/External code The inventory stored ways in basicl & 2tab Eg: Gl, GR. Alternative unit of management MATERIAL GRP. e : Product arp wise report | want to see report profitability report, based on product wise The material grp can be use in profitability analysis module > ‘The material grp is used to address the report requirement OLD MATERIAL NO: can be maintained legacy material Code for ref purpose DIVISION: We can classfy the product & service like division wise, for reporting purchase > We are using divisions to determinesales area > Each material assign to the division by default later we will change in sales order at item level. > Division is one of the sales org tinit > By default each material update to the division > Division relevant to tie saleable products PLANT MATERIAL STATUS If we are going to dis continue one product, We put date 31.12.2015 stop the procurement and discontinue product 01.01.2010. if we'try to post the entry i.e procurement and production and system not allows to-posthe entry. Eg:.Food industry, Pharma _ Valid from: This material valid from Material status: Block (or) discontinue Gross weight Net weight — |-Reporting purpose Volume a}E-mail tamensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 BASIC DATA2 TAB PURCHASING TAB Purchasing tab mandatory if want to procure the material externally. ORDER UNIT Eg: Here we stored goods unit but packing case/box AUTOMATIC PO: When we run material requirement programme based on requirement type and system generate PO GR PROCESSING TIMI MRP1, 2,3, 4 /hat is the manufacturing time to get goods MRP 1234, mm module, sales module, costing, production modules using MRP tabs. MRP 1 tab: ABC category : In the MRP 1 tab classifying material, category wise to do the better analysis and optimization of high value Management can analyse the optimize inventory cost & quantity. A- High value 8- Medium C-Low volume PLANT SPE-MATERIAL STATUS lf we want stop discontinue for the product MRP type: Material requirements can be plan either manually or automatically based on req type in the material master > When we generate MRP program - system plan for procurement & production Based on input parameters. External (or) in house, Based on req'type i.e either. external & internal procurement LOT SIZE When we run MRP run as fixed to lot size, minimum quantity and maximum quantity. How we want to place the order that will specify what lot size need to consider IF MIM fixed size in material master then it ignores the minimum & maximum lotjamensh_chowdaryO3yahoo.com Ramesh chowdary Mobile No: 9160004411 FIXED LOT SIZE Lot size 4 Fixed lot size Bop.c In case requirement is [48 Pd In case requirement is 55 P.C - 2 lot size = 55/50 = 2 lot size ~ Llot size = 48/50 = 1 lot size In case requirement is 103 P.C -3 lot size = 103/50 = 3, IF ANY SCRAP IS THERE 10 % Requirement 48 P.C Scrap 10% = 4.8/ 52.8 > lot size52.8/50 = 2 lot size. SCRAP > What are the materials (component) which are not met the quality standards that quantity treated as the scrap. a > Scrap occurs arrive when receive RM. Cohisumption wastage Getting final component vdstage arrive In between thé proves 1) Assemble scrap 2) Componehit'scrap 3) Operational scrap > The final component scrap. Whatever manufacturing that not met the standard quantity is called the assemble scrap. > The output of the production is not met the quality standards. > Every time getting the 10% wastage The nature‘of product during manufacturing 10% wastage ‘According to we need plan (Include) for production. Assemble scrap Blin % - 10% (mm) Wheh we plan for production scrap % is m.m then when we plan for production system considers the scrap. For Eg. If we plan for 100 kg. When we maintain assemble scrap 10 % system consider to 100 + 10 = 110/- will consider.E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 SS FGX->1P.C Plan for 100 P.C + 10% Assemble serap (10% [> RM > ike 100 kg + 10 kg = 110 kg, Lstabour => = 1 Hour 100 hr. + 10 hrs. = 110 hrs. ‘System proposenately increase the input material and activities. Actual goods received it may increase (or) decrease. > Based on this GR (output) price may increase (or) decrease. ‘Assemble scrap can be maintain in the MRP 1 tab] ‘4 Assemble scrap (plan scrap) COMPONENT SCRAP Nothing but input materials usage wastage > When we consume materials ,the wastage arrive i.e that is component wastage. > Input material wastage is called component wastage Eg: RMX 4+ 5% (scrap) for every 100 k.g Eg: FGX > 100 PC 1+ RMX 100 kg +5 kg = 100 + 5 Kg= 105 In case of the component scrap systerm’proposnately increases the input quantity to the external of component scrap. Eg: RMX 4+ Component serap'5 % The FGX 100 kg. 4+ RMX 100 kg + 5 kg (component scrap) = 105 IN CASE OF ONE PRODUCT HAVE THE ASSEMBLE SCRAP & COMPONENT SCRAP Assemble scrap - 10% Corhponent scrap -5 % Plan for 100 P.C. 4 10 % Assemble scrap = 100 10/100 = 10 P.C First calculate the assemble scrap = 100 + 10 = 110 Second calculate the component scrap 5 % = 1105 / 100 = 5. {=}E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 The component scrap can be maintain inthe MAP tab (or) BOM input material + item level Specific material t 4 High priority Next priority > BOM is the high priority then MRP tab next priority > When we will maintain scrap component in RM & BOM level Eg: RMXis using to manufacture multiple products. ‘The wastage happen to (component scrap) to RMX when manufacturing FGX In this case this component scrap % maintain only in Born item level, Eg: If the RMX is scrap component scrap arrive whenever usage to manufacture other products also . In this case component scrap can be maintainm.m > The component scrap calculate after calculating the assemble scrap. First system calculating the assemble scrap then next calculate the component scrap. OPERATIONAL SCRAP Nothing but in process scrapping > Scrapping is arriving in betweeri-the manufacturing process Eg: Manufacturing EGX RMX Operatigh - 10 < LABOUR Operatiori - 20 Operation - 30E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary ‘Mobile No: 9160004411 PLAN FOR PRODUCTION FOR FGX - 100 P.C Operation 10 f>rmx > 100kg Output 95 995 p.c Lstasour> 100 hours ) process operation [5 p. “+ Operation scraps 5%; > Proposnately the material & quantity reduced Operation 20 [> Ruy > 95P.C Output 85 p.c Ls Machine > 95 hours (to P.c scrap wastazd ‘4 operation scraps in operation 256 Operation 30 (Smachine hour's >85'hours-> Output 82 P.C - 3 P.C Operation scrap (3%) Operation scrap is nothing but process scrap. > In the operation"scrap the input quantity and activity quantity proposnately reduced in subsequent operations to the extent of operational scrap. > The operational scrap % maintain in the routing level. > Note:, Practically we will maintain either assembly scrap % (or) operational scrap % system allow to maintainE-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary ce Scrap Assemble scrap Component scrap Operational scrap FGX >100P.C 4+ Assemble scrap 10 % = 110 P.C + operation scrap + component scrap Qperation 1 (was age 5%) [>Rmx > 100kg + 1OKg = 110 kg + 0+ 22 kg = 132 kg ‘+ Component scrap 20% —> Labour > 100 hours + 10 hours = 110 hr. +0 + 0= 110 hours The output of operation 5% 110 X 5/100 = 6 = 100 - 6 = 104 Operation 2 [> Ruy > 100 kg + 4 kg = 104 + 0+ 5kg = 109 kg 4 5% (__smachine > 200 hr. +4 hr. = 104 0+ 0 = 104 hr. Output = 104 10/100 = 11. Output = 93 Operation3 Machine > — 93hours +0 +0=93 hr. 43% 3% 93% =3pe. 100 Output = 93-3 =80P.4 4+ Final output productjamesh chowdary Mobile No: 9160004411 PROCUREMENT TYPE Indicates how you want to procure materials 1) In-house procurement - € 2) External Procuremen - F INHOUSE EXTERNAL PROC & Plan order generates 4 Purchase Request 4 Production order % Purorder > The procurement type specifies how the materials to be procure, Eg: In house production (or) external procurement. > During the MRP run, based on the procurement typé ifi\th@ material master system generates the requirements. Purchase request for external procurement & plan order for in-house manufacturing) In case procurement type ey material master then system generates. Plan order for in house manufacturing, then plan order converted into production orders. If the procurement type ‘F” external procurement, Then system generate L Purchase request L Purchase order Subsequently the purcliase request can be converted in to purchase order. IN CASE PROCUREMENT TYPE ‘X" Then systém generates the plan order and subsequently manually need to be converted either to the production order (or) purchase order. Procurement type ‘€! needs to select: for all in house manufacturing Procurement type ‘F’ needs to select: for all external procured material Procurement type ‘x’ need to select: for those materials procuring both in house And also external & in house procurementE-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 SPECIAL PROCUREMENT This is also type of procurement Eg: Always procure the specific product from specific source like always subcontract the product , always procure from specific manufacturing plant. It specifies procure the material from specific source. > The special procurement type ignores the normal procurement type. Special procurement is the always highest priority. > The special procurement can be used in procurement purpose & costing purpose 1) Procurement purpose 2) Costing purpose “nm nnn “e NTA PLANTS ee HYD BLR = MUMBAI PUNE CHENNAI KOLKATA, Fx frooog rox No BOM No BoM SPL Procurement IND| NO Routing NO Routing Tn material master 80M Ruling SPL PROCUREMENT KEY IN.M.M SPL PROCUREMENT KEY IN M.M > The requirements generates automatically when we run MRP run. % In the receiving plant we will specify procure from the specific plant procurement material SPECIAL PROCUREMENT CAN BE USED BELOW CASES Case1: Procurement of materials for the Depo’s from the specific manufacturing plant by assigning the special procurement indicator in the receiving plant material master. We can specify that always procure material from the specific manufacturing plant Case2: Special procurement key can be used in costing (STD cost estimation for the materials in the depot’s) > Based on BOM & Routing ,system generate cost estimate & update price > By using the special procurement key in the receiving plant material master ,We can copy the cost estimate from the supplying plant to the receiving plant material master. {#)E-mail:Ramensh_chowdaryO3yahoo.com Ramesh chowdary > The special procurement type can be specified in MRP2 tab & costing 1 tab. MRP 2 TAB COSTING 1 TAB The MRP2 tab SPL Procurement key which Costing 1 tab SPL Procurement key Is the Highest priority in the procurement which is the highest priority in case. Of the material of cost estimate of the product BACK FLUSH Auto goods movement This consumption happen > It specify the auto consumption of the materials as per planned quantities either at the time of goods receipt (or) at the time dFoperational confirmation, Automatic goods issue. This back flush indicator specify in 1. Material masters MRP2 tab 2. Workcenter Routing > operation level L, High priority [> when we consume mat at the operation If the material wants always'back flush select | T Operation > work centre 3" priority: second priority High Priority 1 4° The material master back flush it represent the specific material to be back flush always. > The back flush indicator in work centre master & routing it specifies the materials back flushed automatically for those materials assigned to the operation in routing and this material are back flushed automatically at time of confirmation at the operation level > Back Flush is used particularly in the PCC process. {2}Ramesh chowdary ‘Mobile No: 9160004411 BULK MATERIAL ® Greece, Bold’s, and Waste cloth ,these materials we want to track in Bom and the cost we want track as an OH. > Ifactivate this IND during procure materials it book as a cost to cost centre. Then cost is allocated From cost centre to >order through OH methods » Ifthe indicator is activated then the expenditure is booked against the cost centre during the procurement of the material > No further cost booking at the time of bulk material issue to the production order. > The bulk material costs are allocated separately through the OH materials from the cost centre > to the production order. L MRP 2 TAB BOM ITEM LEVEL High priority MRP 2 TAB 2"° PRIORITY If the mm level not there Bom next priority. Eg: Greece, waste cloth, Bold’s, nets, washers, oil MRP 3 TAB Strategy tab: It specify that the product to be procure (or) manufacture either to the make to stock (or) make to order The strategy group specify whether the material produce (or) procured. in make to stock scenario (or) in make to order scenario, Make to order scenario: products are produced based on the customer specification MRP 4 TAB Discatinting: We want to discontinue the specific product from the specific period (Or) To discontinue dependent material also. Need to specify the discontinued indicator in the material master for those products to be discontinued. ‘When discontinue what is the replace product that will specify the discontinue INDE-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Mobile No: 9160004411 1) Single/Parallel discontinue part/material —> Ifselect 2) Dependent parallel discontinued part or Material. It specify whether the specific material to be discontinue (Indicator) (Or) Specific materials along with the dependent materials { Indicator 3) EFFECTIVE OUT DATE: Effective date of discontinue indicator FOLLOW UP MATERIAL: Specify replacement material of the discontinue product X (TIVE MANUFACTURING: If the product manufacturing repetitive scenario then the repetitive IND to be activate in material master. > The repetitive indicator specifies weather the products are produced in the repetitive manufacturing scenario (or) discreté manufacturing scenario. > If the indicator is activated then the product is manufacturing in repetitive mfg scenario > Af the indicator is not activated then the product is manufacture/ producing in the discrete manufacturing scenario, © REM Profile: Repetitive manufactuting’profile REM profile controls the repetitive manufacturing process REM profile is used in the PCC process ACCOUNTING 1 TAB Valuation category: Go Is used to activate material split valuation. Price Ee: External proc~ 10 call > valuation type 17” 100/- RMX & oft Price ‘Ext procure —import > valuation type 7 110/- Sof2 In the above case , the materials to be valuated and posted to different GL accounts separately based on valuation type. We need assign valuation category to activate split valuation for the specific material Valuation category it activates the split functionality for the material VALUATION CLASS: Link between material master & G/L accounts. { 54 }E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary VALUATION CLASS SALES ORDER: Where we want to post different G/L in make to order case specific customer order wise. > This valuation class used to account the different G/L account in case of materials are procuring and using for the specific customer order wise Normally we are not use unless require the business PROJECT STOCK VALUATION CLASS: We can assign the valuation class in case if want to account different G/L account for those materials procured and used in projects. PRICE CONTROL: > It specify how the inventory to be valuated. > The price control specifies which method to be used to valuate the material —- RRICE CONTROL i _ —_ ee — | (8) Standard price | | (Moving ave (or) Periodic unit price —_ | | METHOD Plan price method Weighted AVG Price method L. Nothing but fixed price for the specific period /till the next change| This std price can be specified ‘either Manual Price or we can.update through Standard Cost estimate programme > When we run programmie based On Std cost estimate, system calculate pricd ‘And estimate price update in mm Accounting] Tab current std price and also Costing1 tab > Itignores the actual price to valuate the Inventory > The inventory always valuated with plan Price ( STO price ) + The difference between plan & actual Price it will be accounted to the price Difference a/c In case of the external procurement. It Transfer to the production variance { 5 }E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary Account in case of in nouse Manufacturing product Case 1: External procurement Eg: Rmx(s) 100 10 pe = 1000 PO. 1000-11000=100 4s Rmx 340 pe 110 = 1100 GR >10 pc 100 = 1000 "purchase price difference =100, The difference between STD prices and PO Price Dr Stock 1000 Dr Price diff > 100 Cr GR/IR > 1100 Invoice received -> 130/- * 10.p. The difference between purchase order and invoice 10 p.c * (130-110) = 200 Dr GR/IR > 1100 Dr Price Diff > 200 Cr vendor = > 1300E-mail:Ramensh_chowdary03yahoo.com Ramesh chowdary ‘Mobile No: 9160004411 CASE 2: IN HOUSE MANUFACTURING FGX(s) 5000/- 1pe = 5000 PRODUCTION ORDER GR from production order to stock ftp.c (FGX) DrStock1pe > 5000 [RMX 15 P.Cx100=1500 crcoom > S000 h> oH > ACTUAL COST OF GOODS MFG GR x 1P.C x S000 PRODUCTION VARIANCE > The production variance > At the time of settlement of the production order (2500/-) the variance will bé transfer to the production variance. Or Production variance > 2500 crcoem > 2500 Cr production order 2500 PRICE CONTROL (V) 4+ Moving average price (periodic unit price), 4 Nothing but weighted average price > The moving average price recalculates for every invoice and goods receipts. > Recalculate moving average price after every goods received, GR from vendor stock (or) GR from production order and also recalculate invoice received and also every settlement of production order.All these cases it re calculate the moving average price > Im case of the external procurement if any difference between the purchase order and invoice i.e the price between PO & invoice. Case 1: The invoice quantity is less than inventory quantity; in this case the price difference fully loaded an existing stock GR IR PO @ 100x 10 pe (R@110«10P.¢ Gr Or Stock - 1000 Dr GR/IR > 1000 crar/iR - 1000 Dr Stock > 100 Cr vendor > 1100