15sub Contracting

SAP MM Interview Questions and Answers by B G Basetty & Rajendra G
SUB CONTRACTING
1. What are special stocks and what are the special stocks in SAP?
A: Special stocks are stocks that are managed separately as a result of their not
belonging to your company or being stored at a particular location.
Special Stocks in SAP:
 Consignment
 Subcontracting
 Third party processing
 Pipeline handling
 Returnable transport packaging
 Stock transfer using stock transport order
 Sales order stock
 Project stock
2. Tell me about the subcontracting cycle?
A: The followings are involved in the subcontracting cycle:

 You order an end product using subcontract order. The components that
the vendor needs to manufacture the end product are specified in the
purchase order.
 In inventory management the components that the vendor needs to
manufacture the end product are posted to the stock type “stock of
material provided to SC vendor”. The components are then supplied to the
SC vendor.
 The vendor performs its service and delivers the ordered material (end
product). The goods receipt is made for the ordered item and at this stage
only the consumption of the components provided to SC vendor is posted.
 If after the goods receipt has been posted, the vendor informs you that a
larger or a smaller quantity of the components was actually consumed than
planned in purchase order. Then you must make an adjustment through
subsequent adjustment.
 The vendor charges for his or her service. The invoice is posted in invoice
verification.
3. What is sub contracting? What are the configuration settings for a sub
contracting order? How is the material delivered to SC vendor in SAP?
A: Subcontracting is a process in which you order an end product from a vendor. The
components required by the vendor to manufacture the ordered end product are
listed in the purchase order and provided to the vendor. The vendor then produces
Page 76 of 127 Sub Contracting

the end product from the components that are provided to him and delivers it to
you.
For a sub contract order the followings are the prerequisites:
 Item category – L
 Components details
 Price (Vendor’s service)
The components that the vendor needs to manufacture the end product are first
posted from un–restricted stock type to the stock type “stock of material provided
to SC vendor”. From this stock type the components are then supplied to the SC
vendor.
The transfer posting of the components from un–restricted stock type to the stock
type “stock of material provided to SC vendor” can be done in three ways:
 MB1B with movement type 541
 ME2O with movement type 541
 MIGO using transfer posting with movement type 541
4. For sub contracting what are the mandatory fields?
A: In subcontracting PO the followings are the mandatory fields:

a) Item category – L
b) Components details
c) Price (Vendor’s service)
5. For sub contracting what are all movement types?
A: Movement types for sub contracting:

a) 101 – GR from SC vendor
b) 541 – Transfer posting from un–restricted stock type to the stock type
“Stock of material provided to SC vendor”
c) 543 – Goods issue for sales order stock
6. Can you send material to a subcontractor via shipping? If yes what is the
IMG setting involved and what is the delivery type if any?
A: Yes we can send material to a subcontractor via shipping by creating an SD

delivery from the list of stock for the subcontractor.
 IMG Settings: IMG → MM → Purchasing → PO → Set up subcontract
→ Assign Delivery Type and Checking Rule
Delivery types: EL – Shipping notification order
LB – Delivery for subcontractor

7. How are the byproducts taken care of in subcontracting?
A: The followings steps are involved to take care of byproducts in subcontracting:

 Similar to production order processing, byproducts are entered in the
subcontract order as components with negative quantity
 During the provision of components with reference to subcontract order
the system ignores the negative component items.
 In the goods receipt for the subcontract order the system automatically
posts the goods receipt of the byproducts. In the material document you
can identify the byproduct items from their movement type 544. Note that
the byproducts are posted to stock of material provided to vendor.
 To transfer the byproduct quantities from the stock of material provided to
vendor to unrestricted use stock you enter a transfer posting using
movement type 542.
8. How is scrap accounted in subcontracting?
A: See Question No: 8
9. How are the variations in subcontracting taken care of in SAP?
A: The variations in subcontracting can be taken care of in SAP through Subsequent

Adjustment [T-code MB04]
10. What are the accounts affected in subcontracting GR?
A: The following accounts are affected in subcontracting GR:

a) BSX – Stocks account (unfinished products)
b) WRX – GR/IR clearing account
c) BSV – Change in stock account with subsequent adjustment (Cost of
Goods Sold)
d) FRL – External service (Purchased service)
e) BSX – Stock accounts of components
f) GBB – Offsetting entry of stock posting (Consumption of Raw
Materials)
11. How do you provide components to SC vendor without using ME2O and
MB1B?
A: Through MIGO using transfer posting and movement type 541

12. Explain about activities that will happen for receipt of semi finished goods
from a SC vendor? What all the movement types involved? Where do you
enter? What is the transaction code? How does the screen look like explain?
A: the following activities that will happen for receipt of semi finished goods from a
SC vendor:
 Order item is posted to the stock account that is the semi finished goods
are taken into our inventory.
 The consumption of the components provided to SC vendor is also posted.
The movement types involved in GR of semi finished goods:
 101 – GR of semi finished goods
 543 – Goods issue to the SC vendor
101 is entered at the header level & 543 is automatically taken by the system at
item level.
T – Code: MIGO
13. The material received from SC vendor is defective how do you returns it to
vendor? What transaction is used? What is the movement type? How do you
enter it? What will happen to components posted as consumption? Explain?
A: If the material received from SC vendor is defective then it is returned to the

vendor by entering the return delivery in MIGO by giving the material document
number generated as a result of GR as the reference.
Movement types involved:
 122 – Returns to vendor
 544 – Reversal of consumption
There is no need to enter these movement types. Once you select the return
delivery in MIGO the system automatically takes these movement types.
The components posted as consumption at GR are once again managed as stock
of material provided to vendor.
14. Which documents can be used to procure materials from a subcontractor?
A: Purchase requisition, PO, and a Scheduling agreement. (Item category ‘L’)
15. What is the purpose of sub – items to a subcontract item on a purchase

order?
A: These are the components that are provided to vendor for manufacturing the
ordered material.

16. What are the two ways in which components can be entered on a subcontract
item on a purchase order?
A: Manually and Copied from an existing BOM (BOM explosion).
17. What is subcontractor info record?
A: A purchasing info record for a subcontractor. The record contains information on

conditions such as the subcontractor’s service price for manufacturing the ordered
material.
18. How can components to be provide to vendor in subcontracting?
A: The components that the vendor needs to manufacture the end product are first
posted from un–restricted stock type to the stock type “stock of material provided
to SC vendor”. From this stock type the components are then supplied to the SC
vendor.
The transfer posting of the components from un–restricted stock type to the stock
type “stock of material provided to SC vendor” can be done in three ways:
 MB1B with movement type 541
 ME2O with movement type 541
 MIGO using transfer posting with movement type 541
19. When are subcontract components consumed from inventory?
A: At the time of goods receipt of the finished product (ordered material).
20. How are goods receipts valuated in subcontracting?
A: The goods receipt is valuated at the subcontract price plus the value of the
components consumed.
21. What is the setting in material master record for subcontract order?
A: No separate settings in material master record for subcontracting.
22. In invoice verification of sub contracting STO what are the accounts
affected?
A:

15sub Contracting

Uploaded by

Copyright:

Available Formats

15sub Contracting

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

15sub Contracting

Uploaded by

Copyright:

Available Formats

What are special stocks and what are the special stocks in SAP?

What are special stocks and what are the special stocks in SAP?

Tell me about the subcontracting cycle?

Tell me about the subcontracting cycle?

SAP MM Interview Questions and Answers by B G Basetty & Rajendra G

2. Tell me about the subcontracting cycle?

A: The followings are involved in the subcontracting cycle:

Page 76 of 127 Sub Contracting

4. For sub contracting what are the mandatory fields?

A: In subcontracting PO the followings are the mandatory fields:

5. For sub contracting what are all movement types?

A: Movement types for sub contracting:

A: Yes we can send material to a subcontractor via shipping by creating an SD

Page 77 of 127 Sub Contracting

7. How are the byproducts taken care of in subcontracting?

A: The followings steps are involved to take care of byproducts in subcontracting:

8. How is scrap accounted in subcontracting?

A: See Question No: 8

9. How are the variations in subcontracting taken care of in SAP?

A: The variations in subcontracting can be taken care of in SAP through Subsequent

10. What are the accounts affected in subcontracting GR?

A: The following accounts are affected in subcontracting GR:

A: Through MIGO using transfer posting and movement type 541

Page 78 of 127 Sub Contracting

A: If the material received from SC vendor is defective then it is returned to the

14. Which documents can be used to procure materials from a subcontractor?

A: Purchase requisition, PO, and a Scheduling agreement. (Item category ‘L’)

15. What is the purpose of sub – items to a subcontract item on a purchase

Page 79 of 127 Sub Contracting

A: Manually and Copied from an existing BOM (BOM explosion).

17. What is subcontractor info record?

A: A purchasing info record for a subcontractor. The record contains information on

18. How can components to be provide to vendor in subcontracting?

19. When are subcontract components consumed from inventory?

A: At the time of goods receipt of the finished product (ordered material).

20. How are goods receipts valuated in subcontracting?

A: No separate settings in material master record for subcontracting.

Page 80 of 127 Sub Contracting

You might also like