SAP–MM (MATERIAL

MANAGEMENT)
Introduction to SAP (System application products in data processing)
SAP stand for system application products in data processing.
SAP is an ERP tools. (Enterprises resource planning).
SAP is a German software introduced in the year 1971 and implemented in the year 1972
by following 5 IBM engineers.
Wallen Reuther
HOPP
Hector
Plattner
Tschira
in SAP EURO’s currency is used.
What is SAP?
SAP is an ERP tool, application or leading software which is used to support each and
every business process of the company such as purchasing, material services, selling and
delivery goods to company’s customers, finance, manufacturing activities (converting to
RM to final products), logistics activities and warehouse management.
Why SAP?
SAP offers following advantages.
 It is Market leader in providing solution and services to every business requirement.
 The beauty of SAP is integration of modules.
 Data security.
 SAP will capture each and every transaction tacking place in the company from
starting to end.
 SAP will provide solution to all the department.
Why not SAP?
SAP suffers from following disadvantages.

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 High cost.
Who will use SAP?
SAP can be used all type of industries such as
 Pharmacy.
 Chemical industry.
 Construction industry.
 Engineering work and procurement companies.
 Automobiles.
 Banking.
 Insurance.
 Retail companies etc.
SAP will bring all the received department on single platform to do the business.
Modules in SAP: -
In SAP each object is called module.
Each and every business process of the company will be treated as module in SAP. In SAP
we have functional, technical and business modules.
The people who are working in functional modules are called functional consultants and
for this no coding knowledge is required.
The people working in technical modules like ABAP are called technical consultants or
developers and for this coding knowledge is required.
List of functional modules: -
 FI - Finance.
 CO - Controlling.
 MM - Material Management.
 QM - Quality Management.
 SD - Sales and Distribution.
 PP - Production Planning.
 PM - Plant Maintenance.
 PS - Project Systems.
 WM - Warehouse Management.
 HCM - Human Capital Management.
From technical side we have ABAP – Advance Business Application Programming and
BASIS module, SAP security etc.

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Roles and responsibilities of individual modules consultants: -
FI - Finance:
This module helps in company’s all financial activities such as.
 AP - Account payables,
 AR – Account receivables, and Taxations.
CO - Controlling:
This module helps in capturing cash flow of the company.
MM - Material Management:
This module supports all purchasing activities of materials and services, inventory
activities and invoice verification before making payment.
QM - Quality Management:
This module helps in quality (QC) check of company’s materials.
SD - Sales and distribution:
This module helps in all sales activities and delivery materials to customers.
PP - Production planning:
This module helps in all manufacturing activities of company’s materials.
PM – Plant Maintenance:
This module supports all maintenance activities of the company.
PS – Project System:
Mainly this module will used in EPC projects - Engineering works Procurement
constructions. This module capture projects budgets.
WM – Warehouse Management:
This module helps in storing company’s materials physically.
HCM – Human Capital Management:
This module helps in all HR activities.
ABAP – Advance Business Application Programming:
This module consultants will write new program to new data in SAP. This module
consultants are called developers.
What happen in real time projects: -
Once we receive requirement then we consultants we check solution in standard SAP and
if we got solution then we confiture (setting/design) as per client’s requirements.

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Once

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configuration is done then we consultant and clients will be testing and if it working fine
then will handover to clients. Clients will use to do regular business. If incase there is no
solution to client’s requirement then we consultants will approach technical consultant

ABAP with a requirement document called FSD – functional specification document,

based on FSD ABAP consultants will customize new program in SAP.
What is ERP?
ERP stand for Enterprises Resource Planning.
It an application or a tool which support each and every business process of the company.
In market we have many ERP tools such as,
 Oracle,
 JD Edwards,
 People soft,
 BAAN,
 SAP etc.
ERP can be used by small sector industries to large sector industries based on their
business size and strength.
Why ERP?
ERP following advantages
 It saves time and expenses
 It provides real time information whenever we required.
Why not ERP?
ERP suffers from following disadvantages.
 Sometime it is very difficult to map client’s requirement in ERP’s.
FSD – Functional Specification Document.
Under the heading we will learn how to operate SAP system as a beginner.
1. Landscape in SAP/server in SAP:
Server is computer or program or device that provides services to another computer
program and to its users.

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 Landscapes/server in SAP

Development Production
Quality server
server server

Golden Testing Testing

clients clients clients
This server is
used to enter
This server is used Live Business

only for testing

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Squamate of server arrangement is called Landscape

1. Server in SAP

In server we have following servers.

 Development server
 Quality server
 Product server
 Sand box server – it used by consultants to learn to new things before providing
solution to clients and it is not mandatory in all the projects/companies.
 Ideas/Dummy server - it is used for learning SAP. It is also called as rental server.
Basic consultants will design server purchased from SAP any login issues approach basic
consultants.
1) Development server:
In development server we consultants we provide solution to client requirements. Every
development server will have one golden client and 1 or more testing clients (based on no.
of consultants). Golden clients and testing clients are just screen names available under
development server.
In golden clients of development server will be used to maintain solution for client’s
requirement.
In testing clients of development server will used to do testing for the solution provided by
consultant.
2) Quality server:
After providing solution in development server then those solutions will copy to quality
server and in quality server client will do testing and sometimes consultants also will
involve.
3) Production server:
In this server only clients will enter live business data.
Consultants don’t have access to production server and clients don’t have access to
development server.
1. Used new page icon in login pad to maintain server details. Server details will be
given by basic consultant based on project allocated to you. Once we save server details in

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logon

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pad system will add a server line under connection option which is used to login. Double click
on sever line to login.

2. Each and every screen of SAP will be identified with 3 digits numeric code called
client. Client 800 is designed by SAP standard which is used only for practice.

3. In real time projects we will use different client codes from 002 to 999 except 001 and
800, these client code will be decided by project manager and designed by BASIS
consultant. Some of the real time client codes are as below (just for idea/sample code).
Example purpose:

Realtime client examples

Servers Clients Project-1 Project-2 Project-3
Golden client 100 801 250
Development server
Testing client 101 802 251
Quality server 200 850 350
Production server 300 900 450

4. New password:
This option will be used to change password of SAP ID but will changing
password we have to remember following 2 terms.

 We can change password once in a day (24hours).

 System will not accept last 5 used passwords.
** Note – In real time projects server details and login credentials will give by
basic consultants. Basic consultants will help to change password or to unlock SAP if it
locks etc... if we enter wrong password for 3 times then SAP will get lock. In this case
approach institute for unlock.
5. SAP has given in default languages:

 EN – English
 DE – German
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 6. Maintain user name and password to login.

7. When we login into SAP in any server system will open a default screen called “SAP
EASY ACCESS”. In this easy access both consultants and clients work based on server.

SAP easy access screen of production server will be used by clients to enter day to day
business activities and consultants will used the same in development server for testing
purpose.

In quality server easy access used by both clients and consultants only for testing.

8. Consultants will provide solutions to client’s requirement in development server –

golden client – IMG screen.

IMG screen for implementation guide.

9. We have 2 ways to enter any data in SAP. They are

 Path/Navigation (long route to enter data).

 T. Code / transaction code (short cut to enter data).

10. Navigation to IMG screen:

After login into golden client of development server Give SPRO T. code in command box
→ press enter → click on SAP reference IMG and system will display IMG screen where all
module consultants will work.

SPRO - SAP project Reference object.

11. We can open 6 screens with one login ID.

12. How to Log off SAP?

 Go to systems in menu bar → then click on Log off option.
 Or directly we can close the screen.
 Or type T. code - /NEX then press enter to log off.

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 Types of Data in SAP
Whenever we consultants receive the requirement from clients then we will divide those
requirements into following 3 types of data. They are:

Organisation data

3
Clients’
Types of Data’s Master data
requirement

Transactional data

Organization data:

Organization structure is always created by consultants in IMG screen of golden client –

development server and it will be tested in easy access screen of testing client –
development server.

Organization data is also called organization structure or enterprise structure.

Every organization will have a structure according to which entire business runs. Every
organization structure will have organization level with their own roles and
responsibilities.

SAP MM will have followed standard organization structure.

 Alphanumeric.
 Non case sensitives.

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 MM Organization Data

1. Company (6 CHAR) This organization level will

be created by FI
2. Company Code (4 CHAR)
consultants in Realtime
3. Purchasing organization (4 CHAR) projects.
This organization levels will
4. Plant (4 CHAR)
be created by MM
5. Storage Location (4 CHAR) consultants in Realtime

Define company:
Company will be created by finance consultants in real time projects. Company is an
organization formed by individual person or group of people to do business in market.
Company accepts maximum length (6 CHAR)
Use below T. code or path to create company in SAP.
T. code- OX15
(OR)
Path:
SPRO→ IMG→ Enterprises structure→ definition→ financial accounting→ define
company→ enter→ go to new entries→
 Given company unique code (6 CHAR)
 Company name,
 Street,
 Postal code,
 City,
 Country (IN),
 Language (EN),
 Currency (INR),
 Press enters.
 Click on save icon to save new company in SAP system.
Note:
Use same T. code OX15 or the above path to create, edit, check and delete company.
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Define company code:
Each and every business of the company will be created as company code in SAP.
Company code is a legal entity with their own balance sheets and profit and loss A/c.
company code is the sub division of company.
All financial transactions maintained and saved under company code only and company
code will be created by FI consultants.
As we are non-FI consultants se don’t know how to figure FI setting so we will use SAP
standard company code 1000. In this 1000 company code SAP defined all FI setting for
non-FI consultants to practice SAP.
We can use standard company code 1000 or we can create new company code by copying
standard 1000. If we do copy then all the FI setting from 1000 company code will copy to
our own company code.
Use below T. code or path to copy company code.

OX02– create/edit/delete company code (FI will USE in projects)

EC01 – copy company code.
Path:
SPRO→ IMG→ Enterprises structure→ definition→ financial accounting→ Edit, copy,
delete, check company code→ double click on copy, delete, check company code line →
click on copy org. object icon→ then give FROM company code 1000 and give TO
company code (our own 4 CHAR code) → Enter→ click yes to copy G/L account → click
yes to change currency, maintain currency (Ex. INR) → continue for 4 times→ click NO
to copy number range→ continue→ click cancel(X) → click copy→ read the information
and continue→ Go back→ Double click on edit company code line→ click on position→
Give your own company code→ Enter→ Double click on your company code→ maintain
company name, city, country, language, key then press enter→ click on address icon,
maintain company code address in detail (address will be given by clients in real time
project but in practice we have to maintain o assumption) → press enter and save the
company code. Maintain purchasing organization:
Purchasing organization will be created by MM consultants even real time projects.
Clients purchasing department will be created as purchasing organization in SAP system.
Purchasing department are responsible for purchasing material and services required by
the company.

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T. code – OX08
Path:
SPRO→ IMG→ Enterprises structure→ Definition→ Material management→ Maintain
purchase organization→ Enter→ Click on new entries→ Give your purchase organization
(4 CHAR), maintain description→ Press enter→ Save.
Define Plant:
Plant will be created by MM consultants but it will be used by entire logistics. Plant is
place where business happens or material manufacturing happens.
Whether it is a construction site, Brach, Metro station, manufacturing units, Depots will be
created as plant in SAP system by using below T. code or path.
T. code – OX10
Path:
SPRO→ IMG→ Enterprises structure→ Definition→ Logistics General→ Define, copy,
delete, check, Plant→ Define plant→ Press Enter→ Click on new entries→ Give your
own plant (4 CHAR), maintain plant name→ Press enter→ Click on address icon and
maintain plant address in details→ Press enters and save the plant.
Main storage location:
Storage location is the place where material is store physically inside the plant (within the
plant). We can have multiple storage location under one plant to store different types of
materials.
Use below t. code or path to define new storage location to the plant.
T, code – OX09
Path:
SPRO→ IMG→ Enterprises structure→ Definitions→ Material Management→ Maintain
storage location→ Enter→ Click on new entries→ Give storage location (4 CHAR),
maintain storage location→ Name of the storage location→ save.
Assignment of Organization Structure:
Under this heading will assign organization level to convert into organization structure.
Assign company code to company:
We can assign multiple company code under one company.
Path:
SPRO→ IMG→ Enterprises structure→ Assignment→ Financial Accounting→ Assign
company code to company→ Enter→ Click on position.

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Assign plant to company code:
We can have multiple branches.
Path:
SPRO→ IMG→ Enterprises structure→ Assignment→ Logistics General→ Assign plant
to company code→ Click on New Entries.
Assign Purchasing organization to company code:
If we Assign purchasing organization to company code then if will become central
purchase organization. It is responsible to buy material and services to all the branches.
Path:
SPRO→ IMG→ Enterprises structure→ Assignment→ Material Management→ Assign
purchasing organization to company code→ Enter→ Click on position.
Assign purchasing organization to plant (plant specific):
It we assign purchasing organization to pant then it will become plant specific purchase
organization. It is responsible to buy material and services to only assigned branches.
Path:
SPRO→ IMG→ Enterprises structure→ Assignment→ Material management→ Assign
Purchasing organization to plant→ Enter→ click on new entries.
How to check organization structure in single screen:
 Go to T. code EC01.
 Click on structure.
 Click on navigation then continue.
 Click CTRL+F→ give your Own.
 Company code→ press Enter.
 Click on your company code.
 Again, double click on your company code and check the organization structure.

Master data:

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Master data is a onetime activity created by clients in real time project in easy access
screen production server and we consultants have to do backend setting of master data in
IMG screen of development server – golden client.
The information of a material, vendor and customer maintained in SAP system is called
master data.

Types of master Data in SAP MM

In SAP – MM we have following master data’s

Material Master data

Vendor Master data

Purchasing info record (PIR)

Types of
Master Data’s
Source List

Quota Arrangement List (QAL)

Condition Master data (Pricing)

1. Material master data:

Material is one of the master data available in SAP MM.
Material is also called item, goods, products. The information of the material like material
description, material UOM material weight etc. maintained in SAP system is called
material master data.
Material is the first mater data available in MM.

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Why we create material in SAP system:
If we want to buy, sell the check the material stock status throw SAP
system then we have to create in SAP system.
Business requirement:
In real time project client deals with different types of material such
as raw material, semifinished, finished material, spares, consumables, packing material,
food material, operating material, trading material etc... we consultants have to provide
solution different types of material in SAP system.

Consultant role in material master:

Under this heading we will learn how to provide solution to client requirement in material
master, we will do these setting in IMG screen of golden clients – development server.
1. Define material type:
Material type differentiate the types of material in SAP system by generating material code
to every material. SAP has designed below standard types.
 ROH – Raw Material
 HALB – Semi finished material
 FERT – Finished Goods
 VERP – Packing Material
 ERSA – Spares
 FOOD – Food Material
 PIPE – Pipeline material
 PIEN – Services (In ECC version)
 SERV – Services (In S4 HANA)
 HAWA – Trading Material
 NLAG – Nonstock Material
UNBW – No valuated material:
We can use above standard material types or we can customise new material types by
copying standard.
Examples of material type codes customization in live projects:
 ZRM – Raw Material
 ZSFG – Semi finished good
 ZFG – Finished good

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  ZSPR – Spares
 ZCON – Consumables
 PIPE – Pipeline material
 SERV – Service material
 FOOD – Food Material
 ZPAK – Packing Material
 ZNVL – Non – Valuated material
 ZTG – Trading goods
 ZOTH – Other materials
 ZSCP – Scrap Material
 ZOM – Operation Material.
Use below T. code or Path to define new material type
T. code – OMS2 – Material type.
Path:
SPRO→ IMG→ Logistics general → Material Master→ Basic Setting→ Material Type→
Define attributes of material type→ Enter→ Click on Position→ Give standard material
type ROH for raw material→ Enter→ select ROH line→ click on copy as icon→ Give
you own material type (should start with Z or Y with 4 CHAR), maintain material type
description→ press enter, click continue and save the material type.
Note: Use same above steps to configure other material types.
Material type control material master types of control:
 It controls number range of material.
 It manages fields of materials.
 It controls views of material.

Define number range of material:

Number range will be used to identify materials in SAP system. Each material will have
unique code which will be used to buy, sell or to check material stock in SAP system. This
unique code will generate based on material type.
We consultant will create number ranges and it will be assigned to material type. Clients while
creating materials they will select material type, based on material type selection system
will generate material code.

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In SAP standards for each material type we can maintain 1 internal and 1 external number
range.
Internal means system will generate automatically within the range defined in SAP system
and while creating material if we are entering material code manually within the range
defined then it is called external number range.
Material number range length is 18 digits maximums.
Internal number range will accept only numeric and external will except alphanumeric.

T. code – MMNR
Path:
SPRO→ IMG→ Logistics - general → Material Master→ Basic Setting→ Material
Type→ Define number ranges for each material type→ Press Enter.
Define field selection of material master:
Field selection will be used to manage field of material. Managing field is nothing but we
can make field mandatory, optional, display or we can hide the fields.
In SAP standard each material type should have one field selection to manage fields. SAP
has designed below standard field selections.

 ROH – Raw material field selections

 HALB – Semi finished material
 FERT – Finished material
And for remaining all other standard material type SAP is used ROH as standard field
selection.
We can use above standard field selections or we can customise new field selections by
copying standard. (Same like material type).
Use below T. code or path to define, manage and assign field selections to material type.

T. code – OMS9
Path:

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 SPRO→ IMG→ Logistic General→ Material master→ field selection→ Maintain field
selection for data screens→ Click on position→ Field reference ROH raw material
selection→ Enter→ Select ROH line→ Then click on copy icon→ Filed reference your
own field selection (4 CHAR) → Press enter→ Double clicks on your own field
selection→ Click on field selection group in (contract icon) → Check the field name and
close→ Manage the field and save it→ Go back→ Material type screen (OMS2) → Click
on position→ Give your own field selection→ Press enter→ Double click on own field
selection→ Assign field reference to change own field selection→ Press enter→ Then
save it.
Views of material master:
If any debt wants to use the material, then we have to inform system by selecting views.
SAP has designed below standard views to create material.
Views are nothing but departments available in the company/clients.

Views of Material Master

MM FI CO SD PP WM QM
Basic Data 1 Accounting 1 Costing 1 Sales Org 1 MRP 1 WH 1 QM
Basic Data 2 Accounting 2 Costing 2 Sales Org 2 MRP 2 WH 2
Sales general/plant
Purchasing MRP 3
data
Purchase order test Sales text MRP 4
Plant Data/Storage 1
Plant Data/Storage 2

Clients’ role in Material Master:

Under this heading we will learn how to create material manually but in real time
project clients will create the material and we consultants have to provide training along
with user manual.
User T. code- MM01 – Create material
Creation on Material with MM views
Path:

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SAP Easy Access→ SAP Manu→ Logistics→ Material Management→ Material
Master→ Material→ Create (General) → Immediately→ Double clicks on Immediately→
Create Material (Initial Screen).
1. Material:
In this field we have maintain material manually if we have using external number range
or else leave block it we have using internal number range.
2. Industry Sector:
In this field we have to select client industry.
Ex: Chemical industry, construction industry etc...
Click on down ▼ mark industry.
If our client industry not available in the list then we consultant can add new industry
sector by using below T. code or path.

T. code – OMS3.
Path:
SPRO→ IMG→ Logistics General→ Material Master→ Field selection→ Define industry
sector and Industry – Sector – Specific Field selection→ Press Enter→ Click on new
entries→ Give me Industry Sector (1 CHAR) → Industry Description our own industry→
Field reference A→ Then save it.
3. Materia type:
Own material type clicks on.
4. Copy from Material:
If we want create new material by copying exiting material code then in this field maintain
exiting material code.

Select view(s) → view select on 6 views (Basic Data 1, Basic Data 2, Purchasing,
Purchase order test, Plant Data/Storage 1, Plant Data/Storage 2) → Click on default
setting→ Click on Org. level→ Organizational level→ Give me your own plant and
Storage location→ click on tick mark.
1. Basic data view:
Under this basic data we will maintain material general information which is applicable to
entire company as display below.
 Material description.

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  Unit of measurement.
 Material group.
 Old material number.
 Gross weight/net weight.
 Weight unit.
 Volume.
 Volume unit.
 Size/dimension.
 Packing material details.
1. Material description:
Material description is also called as short text in SAP. In this field we have to maintain
material name and it accept 40 CHAR.
2. Base unit:
Int this field we have to maintain unit of measurement in which material is measured.
Ex: kgs, Litres, EA, SQ. Ft. no’s, Bag, MT ETC… we consultant can add new units of
measurement to fulfil client requirement by using below t. code or path.
T. code – CUNI Path:
SPRO→ IMG→ SAP NETWEAVER→ General setting→ Check units of measurement →
Enter→ Click on unit of measurement then click on create icon→ Give units of
measurement (3 CHAR), maintain commercial and technical same, maintain description→
ISO code double click→ Press Enter→ and save it.
3. Material group:
Material group is a sub division of material type. Material with same feature grouping together
is called material group.
In real time project we consultant have to add new material groups. Use below or path to
define new material groups.
T. code – OMSF
SPRO→ IMG→ Logistic- general→ Material master→ Setting for key fields→ Define
material group→ Enter→ Click on new entries→ Give your own material group (9
CHAR), maintain description→ Press Enter→ Save.

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4. Old material number:
In this field we can capture client’s non-SAP material code just to identify materials in
SAP. This is not mandatory field.
5. Division:
This field we will discuss in SD module.
6. X-plant material status and valid from:
If we want to block the material from purchase then in this field maintain 01 – block for
procurement and maintain valid from date.
7. Gross weight/Net weight/weight unit:
In this field we will maintain weight of the material along with weight unit (Grams/KGS
etc…)
8. Volume/volume unit:
Volume will be used for liquid materials.
9. Size/Dimensions:
In this field we will maintain material size like height/width etc…
10. Packing material data:
In this field we have to maintain packing material details to pack main material. Packing
materials are like polytene, paper packing, wooden packing, steel packing, bag packing
etc… we have to create packing material in same t. code y using packing material type.
Press enter and go to purchasing view.
Purchasing view:
In this view we will maintain material purchasing information. This information belongs
to individual plant.
1. Base unit:
This field will copy automatically from basic data 1.
2. Order unit:
In this field we have to maintain unit of measurement in which material is ordering to
vender/market.
If order uniting base unit are different then system will ask conversion factory when we
press enter.
Ex: 1 dozed = 12 each
1 ton = 1000 kgs etc…

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If order unit and base unit are same then leave order unit field blank because it will copy
base unit automatically.
3. Purchasing group:
Purchasing group is also called as buyer group. The group of people from purchasing
department who are involved buying material from market is called purchasing groups.
In real time projects we consultants must add new purchasing groups to fulfil our client
requirement.
T. code:
OME4 Path:
SPRO→ IMG→ Material management→ Purchasing→ create purchasing group→
Enter→ Click on new entries→ Give your own purchasing group (3 CHAR), Maintain
description, Telephone→ Press enters save.
4. Material group:
This field will copy automatically from basic data 1.
5. Auto PO:
In SAP we can create purchase order manually and automatically. If we want to create PO
automatically then first step is to activate this field in material master.
6. Batch management:
If we want batch number for the material then activate this field.

7. Purchasing value key:

7.1 1st Reminder/2nd reminder/3rd reminder:
If we want to send reminder to vendor for delivering material on time then in these field
maintain reminder days and with the help of ABAP consultants, we will design reminder
massage.
7.2 Underdel/ overdely/unlimited over-delivery tolerance:
If we want receive material quantity less then ordered quantity then maintain underdeliver
tolerance in %. If we maintain underdeliver tolerance than system will allow us to receive
material quantity less – then ordered quantity. If we want receive material quantity more
than ordered quantity then maintain overdeliver tolerance in %. If we maintain over
delivery tolerance than system will allow us to receive material quantity more then ordered
quantity. If we want receive material quantity more than order quantity without any limit
than activate unlimited over-delivery tolerance.

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7.3 Acknowledgment required:
If we want acknowledgment copy from the vendor for given material order then activate
this field.
 Reminders/tolerance and acknowledgment will be updated by maintaining purchasing
value key. We consultants can add new purchasing value key by using below path.
Path:
SPRO→ IMG→ Material management→ Purchasing→ Material Master→ Define
purchasing value key→ Enter→ Click on new entries→ Give purchasing value key (any 4
CHAR code), maintain reminder days, tolerance, activate acknowledgment as per client
requirement→ Press enter→ Save.
This purchasing value key we have select in every material if we required.
8. GR processing time:
In this field we have maintain no of days required time goods to storage location after GR
(Goods receipt) and quality check.
9. Source list:
If we want to assign fixed vendor to a material then activate source list and we will
maintain fixed vendor in 4th master data.
10. Manufacturing part number:
In this field we can maintain material model numbers.
11. Manufacturer:
In this field we can capture material manufacturer details and this is not mandatory field.
---------------------------------------Press enter----------------------------------------------
Purchase order text view:
In this view we can maintain any material information in the form of text.
Ex: Handle with care etc…
Plant data/storage 1:
In this view we will maintain material storage information in storage location under plant.
This information belongs to individual storage location available in the plant.
1. Base unit:
This field will copy automatically from basic data 1.
2. Unit of issue:
In this field we have to maintain unit of measurement in which material is issue from
storage location to internal departments to external customer.

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If unit of issue and base unit are different then system will ask conversion factor when we
press enter.
Ex: 1 dozed = 12 each
1 ton = 1000 kgs etc…
If unit of issue and base unit are same then leave unit of issue blank because it will copy
from base unit automatically.
3. Storage bin:
Storage bin the exact location in the warehouse where material is stored physically storage
bin will be created in warehouse module.
4. Batch management:
This field will copy from purchasing views.
5. Shelf-life data:
Under this heading we will maintain material maximum storage period minimum storage
period shelf-life expiry date (SLED) along with time unit.
Important note:
The date of production must be entered in the goods receipt.
--------------------------------------Press enters------------------------------------------
Plant data/storage 2:
Profit centre:
This field we will discuss in controlling module.
After maintaining all required data click on save icon to save the material and system will
generate material code at left bottom corner of the screen. We will use this material code
for further process like purchase, sales, stock checking etc…
Extension of material:
We will extend existing material code for following levels.
 View of extension
 Organisation levels extension
Extend material to accounting views:
Sometime in real time project client will miss the view while creating material in this case
we will use extension of material to views concept. Use below process to extend the
material to views.
 T. code – MM01
 Go to T. code MM01.

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  Give extension material code in material field.
 Press enters for 2 times.
 Select accounting views.
 Press enters.
 Give plant.
 Press enter again and maintain below information in accounting view and save the
material.
Accounting views:
1. Valuation class:
Valuation class will be used to link MM and FI modules. It is also helps us to valuates the
material.
2. Price control:
We can maintain 2 types of prices in material master.
 S – Standard price.
 V – Moving average price.
 Standard price is a fixed price maintained for only finished goods.
 Moving average price is a fluctuating price maintain for all material which are buying
from outsider (vender).
Extend material to new plant and storage location:
Under this heading we will learn how to extend material to new plant and storage location
if we have a multiple plants and storage location using same material then follow below
step to extend product to new org. levels.
 Go to T. code MM01.
 Give extension material code in material field.
 Press enters.
 Give same material code in copy from materials.
 Press enters.
 Select views.
 Give extension plant and storage location.
 Give copy plant and storage location.
 Press enters.
 System will copy data from copy plant to new plant in all the views if required edit
the information then press and save the material.

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 The data maintained in SAP in any module will store in database (DB2, ORACLE, HANE
etc..) in the form of tables and fields. We can check tables in blow T. code.

T. CODE OF MATERIAL MASTER

MM01→ Create/Extend material.
MM02→ Change/Edit material.
MM03→ Display material.
MM04→ Changes.
MM06→ Flag for Deletion/ Undeletion.
MM11→ Create schedule material.
MM12→ Change schedule material. TABLES – SE16N
MM13→ Display schedule material.
MM14→ Changes schedule material. MARA→ Material general data.
MM16→ Flag for schedule material deletion. MARC→ Material purchasing data (plant data)
MM17→ Mass maintenance. MARD→ Material storage data.
MR21→ Change material price.
MBEW→ Material accounting data.
MMAM→ Change material type.
MMSC→ Extend material to storage location. MVKE→ Material sales data.
MM60→ Material List. MAKT→ Material description.

-----------------------------------Material Master Data completed------------------------------------

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 2. Vendor Master Data
Vendor is a supplier or seller or service provider. The information of the vendor
like vendor name, address, purchasing info, accounting information maintained in SAP
system is called vendor master data.
Vendor is an individual person or individual company or group of companies who sell
material or who provides service.
We will have different types of vendors like regular vendor, fixed vendor or one time
vendor.
Business requirement:
In real time project company deal with different type of vendors such domestics, foreign,
service, transportation, etc… we consultants have to provide solution to differentiate types
of vendors in SAP system.
Consultant role in vendor master:
Under this heading we will learn to provide solution to differentiate types of vendors in
SAP system.
1. Define vendor account group:
Vendor account group differentiate the types of vendors by generating number (vendor
codes) in SAP system. Each vendor will have a vendor code generates by SAP based on
selection of vendor account group.
SAP has defined below standard vendor account group.
0001and LIEF- vendor
Wed consultant can use below standards or we can customise our own vendor account
groups by copying standard.
Real time vendor account group examples:
o ZDMV – Domestic vendor.
o ZIV – Import vendor.
o ZSV – Service vendor.
o ZSCV – Subcontracting vendor.
o ZTRV – Transport vendor.
o ZOTV – One-time vendors etc…
Use below T. code or Path to define new vendor account groups.

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T. code – OMSG
Path:
SPRO→ IMG→ Logistics general→ Business partner→ Vendor→ Control→ Define
account groups and field selection (vendor)→ Enter→ Select 0001 line→ Click copy
icon→ Give own vendor account group (4 CHAR) → General Data name description own
account name→ Press enter→ Double clicks on your own group→ Data retent. Levels
purchasing, vendor sub range relevant, plant level relevant tick→ Double click on general
data→ Double click on address→ Manage vendor field→ save it.
Note: Vendor account group length is 4 CHAR.
***Vendor master will be controlled by vendor account group.
Types of control by vendor account group:
 It controls number range of vendor.
 It manages field of vendor.
 It controls partner functions.
1. Define number range of vendor:
Number range will be used to identify vendor in SAP system. Each number will have their
own code and those code are generated by system based or vendor account group.
We consultants will create numbers and it is assigned to vendor account group. Client
while creating vendor they will select vendor account group based on this system will
generate code to vendor.
In SAP standard each vendor account group will have 1 internal or 1 external number
range. Internal number range means system will generate automatically and external
means clients have to enter manually while creating vendor but both should be assigned to
vendor account group (mandatory).
Vendor number range length is 10 digit maximum.
T. code:
OMSJ Path:
SPRO→ IMG→ Logistics general→ Business partner→ Vendor→ Control→ Define
number range for vendor master records→ Press enter→ Click on intervals→ Insert line→
Give serial number→ Then give from and to number range→ Press enter and save→ Go
back → Click on number range option→ Click on position→ Give your vendor group→
Enter→ Assign number range→ Save it.

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Define partner functions:
If multiple people or companies are involving in selling of a product then those multiple
people or companies are called partner functions. In standard SAP we have following
partner functions. We consultants have to confiture to our client.
 OA – Ordering address.
 GS – Goods supplier.
 IP – Invoice presented by.
 FA – Forwarding agent.
 VN – vendor**.
Path:
SPRO→ IMG→ Material management→ Purchasing→ Partner determination→ Partner
role→ Define permissible partner roles per account group→ Click on new entries→ Give
all your partner function→ And assign vendor account groups→ Press enter for every
partner function→ Save it→ Go back→ Go back→ Select partner setting in vendor
master record→ Define partner schemas→ Enter→ Click on new entries→ Give partners
schemas (4 CHAR), maintain discerption (e.g.:- vendor partner) → Enter→ Select the
partner schemas line→ Double click on partner functions in procedure→ Click on new
entries→ Draw this box→ And save it→ Go back→ To vendor account group screen
(OMSG) → Click on position→ Give your vendor account group→ Enter→ Double click
on your vendor account group→ Assign your partner schemas in partner schema, purchase
org field→ Save it.
Note:
We can assign same partner schemas in all the vendor account groups
EVENT PURCHASING FINANCE CENTRAL (PUNCH. +FI)
CREATE VENDOR MK01 FK01 XK01
CHANGE/EDIT MK02 FK02 XK02
DISPLAY MK03 FK03 XK03
CHANGES MK04 FK04 XK04
BLOCK/UNBLOCK MK05 FK05 XK05
FLAG FOR DELETION MK06 FK05 XK06

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 Client’s role in vendor master
Under this heading we will learn how to create vendor master in SAP but in Realtime
projects clients purchasing dept/any end user will create vendor and we consultants will
provide training along with user manual.
Use below T. Code or path to create vendor in ECC servers.
T. Code - XK01
Path:
SAP easy access screen→ SAP menu→ Logistics→ Materials management→
purchasing→ Master data→ vendor - Central→ XK01 - create→ Press enters.
Vendor initial Screen:
Vendor: In this field we have maintain vendor code manually if we are using external
number range or else leave blank if we are using internal number range.
Maintain company code to add finance information
Maintain Purchasing organisation to add purchasing information.
Select vendor account group based on type of vendor we are creating.
---------------------------------------------Press Enter-----------------------------------------------------
Address Tab:
In this tab we will capture vendor name, address along with communication details. (This
information we will get from vendor in vendor registration form (VRF)). - Enter.
Control Tab:
In this tab we will maintain vendor GST number in Tax number 3 field.
Payment Transactions Tab: In this tab we have to maintain vendor bank account details.
Contact Persons:
In this tab we will maintain contact person details from vendor side. We can capture
multiple contact person details.
Accounting information Accounting:
In this tab we will maintain recon. Account. - 160000.
Payment Transactions accounting
Check Double Inv.:
If we activate this field then system check duplicate invoices.
Correspondence Accounting: ————-NA———
Purchasing Data Tab:

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In this tab we will maintain purchasing information from vendor.
Order Currency:
In this field we have maintain currency in which vendor is accepting the order.
Terms of payment:
In this field we have to maintain payment terms agreed with
vendor. Examples: 50% Advance payment and 50% delivery
payment 100% on delivery
100% advance payment ETC …
We consultants can add new payment terms to fulfil clients’ requirements.
Path:
SPRO → IMG→MM →Purchasing →vendor master →Define terms of payment →Enter
→Click on new entries →Give payment terms (4 CHAR), Maintain description, No. Of
day, activate account type →Press Enter →Click on save icon.
Incoterms: Incoterms stands for international commercial terms. This helps us to know
the scope of delivery.
 EXW - Ex works
 FOB - free on board
 FCA - Free Carrier
 DDP - Delivered duty paid
 CIF - Cost insurance freight

Schema Group Vendor:

We will discuss this in 6th Master data.
Sales person/ Telephone:
In this field we have to capture sales person details from vendor side.
GR based Inv. Verification:
If we want to make the payment for only received goods then activate this field. If we
activate this field then system will allow to make invoice payment only for goods receipt
(GR) quantity.
Serv. Based Inv. Verification:
If we want to make the payment for only received services then activate this field. If we
activate this field then system will allow to make invoice payment only for received
services. Acknowledgement Required:

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If we activate this field then system will expect acknowledgement copy from vendor for
given orders.
Automatic PO:
If we want to create PO automatically then we need to activate this field (same like
material master).
Purchasing Group:
In this field we have select purchasing group.
Planned Deliv. time:
In this field we have to maintain no. of days taken by the vendor to deliver the product.
Partner Functions: In this tab system will copy partner functions from vendor account
group.
After maintaining all required tabs and fields click on save icon to save the vendor and
system will generate vendor code at left bottom of the screen.
Remaining T. Codes of Vendor:
 XK07 - Change vendor account group.
 XK99 - Mass maintenance.
 MKVZ - vendor’s list.
*** This above vendor master concept is replaced by business partner (BP) in S4
HANA.
Tables - SE16N
 LFA1 - Vendor general data.
 LFM1 - Vendor purchasing data.
 LFB1 - Vendor Company code data.
 LFBK - Vendor bank details.

-----------------------------VENDOR MASTER DATA COMPLETED------------------------

--

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 3. Purchasing info record (PIR)
Purchasing info record is also called as PIR or info record. It is used to capture purchasing
information of a vendor and material combination.
Possibilities of creating PIR:
1. We can create info record manually by using T. code ME11 or we can update info
record automatically by activating INFO UPDTATE check box in purchase order material
data tab.
2. Info record can be created with material code or without material code but material
description and material group are mandatory.
Consultant role in PIR:
1. Define number ranges:
As we are aware info record can be creating with and without material code. We
consultants have to design solution to show difference between with and without material
code info records.
Number range will be used to identify PIR in SAP system. Every material and vendor
combination system will generate unique info record number.
When we are creating PIR with material code system will copy number from IL group if it
is without material code then system will copy number range from IN group, for both IL
and IN we can assign internal and external number range. (Some like material master)
T. code:
SPRO → IMG→ Material management→ Purchasing→ Purchasing info record→ Define
number range→ Enter→ Click on maintain groups→ Click on creating icon→ Give group
name (NR with material/NR without code,) Give FROM and TO number range for both
internal and external (if required) → Press enter → Save→ Go back→ Click CLTR+F→
Give number range (IL or IN) → Press enter→ Click on IL or IN→ Click on
element/group→ Search your number range group and double click on same group→
Save. Define field selection for info record:
As discussion vendor field selection will be used to manage field of info record.
Path:

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SPRO→ IMG→ Material management→ Purchasing→ Purchasing info record→ Define
screen layout→ Enter→ Double clicks on ME11 line→ Double clicks on field selection
group→ Manage field of info record→ Go back 2 time→ save it.
Client’s role in PIR:
Under this heading we will learn how to create PIR manually and in real time project
client and users will create.
Use T. code ME11 or below path to create PIR manually.
Path:
SAP easy access screen→ SAP menu→ Logistic→ material management→ purchasing→
Master data→ Info record→ ME11→ Create→ Enter.
PIR initial screen:
1. Maintain vendor.
2. Maintain material code or we can leave blank if we want to create PIR without
material code.
3. Maintain purchasing organization.
4. Maintain plant.
5. Info record:
In this field we have to maintain info record number manually if we are using external
number range or else leave blank internal number range.
6. Info category:
In SAP standard we can create info record in following categories.
 Standard.
 Subcontracting.
 Pipeline.
 Consignment.
As of now select standard category.
----------------------------------------PRESS ENTER------------------------------------------------
PIR- General data tab:
1. Short text – If we are creating info record without material code then in this box, we
have maintained material description manually.
2. Material group – In this field system will copy material group from material master
and if we are creating info record without material then in this field, we have to maintain
materials group manually.

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NOTE: These above 2 field will copy automatically to info record screen if we are
creating info record with material code.
1. 1st,2nd,3rd Rem./Exped:
In this field system will copy data from material master if required we can edit here which will
copy to purchase order automatically.
2. Sales person and telephone:
In this field system will copy data from vendor master if required we can edit here which will
copy to purchase order automatically.
3. Order unit and conversion:
In this field system will copy data from material master if required we can edit here which will
copy to purchase order automatically.
4. Origin data:
Under this heading we will capture material origin certificate details given by vendor.

5. Available from and to:

In this field we will maintain info record valid dates.
6. Regular vendor:
If this info record vendor is a regular supplier, then activate this check box to inform system. If
in case regular vendor is not available then we will reach prior vendor, maintain prior
vendor. Press enters.

Purchase org. Data 1 Tab:

 Pl. Deliv. Time:

In this field system will copy data from vendor master if required we can edit here which will
copy to purchase order automatically.
 Purch. Group:
This field will copy from material master
 Underdl., Overdl., unlimited delivery tolerance and acknowledgement required:
In this field system will copy data from material master if required we can edit here which
will copy to purchase order automatically.

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  GR - BSD INV:
This field will copy from vendor master.
 Tax code:
In this field we have to maintain tax code to calculate tax on purchase. If we miss to select tax
code here then we can select in purchase order.
Tax codes will be created by FI consultants in T. code FTXP. We
can select VA or V0 tax codes for practise.
 Condition:
Maintain net price
 Text Tab:
In this tab system will copy text from material master purchase order text view. If required we
can maintain text here also which will copy to purchase order.
After maintain all reward fields and tabs, click on save icon to save info record and seem will
generate info record number at left bottom corner of the screen.
PIR T. codes:
 ME11 - Create info record.
 ME12 - Change info record.
 ME13 – Display info record.
 ME14 – Changes.
 ME15 - Flag for deletion.
 MEMASSIN - Mass maintenance.
 ME1M - List of info records by material.
 ME1L - List of info records by vendor.
 ME1W - List of info records by material group.
 PIR Tables - SE16N.
 EINA - Info record general data.
 EINE - Info record purchasing data.

------------------------PURCHASING INFO RECORD TOPIC COMPLETED----------------

---

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 4. Source list

Source list is one of the master data available in SAP MM. it used to maintain fixed
vendor to a material. Once source list is maintained then we have to buy material from
source vendor only.

Source list process flow

Source list

Activate Maintain
source list source list

Consultant Client/Easy

/IMG level access

Material
Plant level
level

Activate source list by consultant:

If consultants activate source, then it will be activated at plant level and it is applicable to
all the material available in the plant.

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T. code-
OME5. Path:
SPRO→ IMG→ Material management→ Purchasing→ Source list→ Define source list
requirement at plant level→ Enter→ Click on position→ Give your plant→ Activate
source list (if required) →Save it.
Activate source list by client:
Client can activate source list only for required material in material master purchasing view.
T. code:
 MM01→ New creation material.
 MM02→ Existing material.
Client’s role:
Maintain source list:
Under this heading we will assign fixed vendor to a source activate material.
T. code→ ME01.
Path:
SAP easy access screen→ SAP menu→ Logistic→ Material management→ Purchasing→
Master data→ Source list→ ME01-maintain→ Press enter→ Give source list activated
material code→ Give plant→ Enter→ Maintain source valid date→ Who vendor source
list→ Give own plant→ Enter→ And save lt.
Source list t. code:
 ME01→ maintain/change source list.
 ME03→ Display source list.
 ME04→ Changes.
 MEOM→ List of source list by material code.
Tables-SE16N
EORD→ Source list.

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----------------------------------SOURCE LIST TAPIC COMPLETED----------------------------
---

5. Quota arrangement list (QAL)

This is one of the master data available in SAP MM. if our client is diving bulk quantities
into ratios and ordering to multiple vendors then it is called quota arrangement list in SAP.
Quota arrangement t. code’s:
 MEQ1→ maintain/change QAL.
 MEQ3→ Display QAL.
 MEQ4→ Changes.
 MEQM→ List of QAL.
Tables - SE16N
 EQUK→ Quota header table.
 EQUP→ Quota item table.

----------------------------------QUOTA ARRENGEENT LIST COMPLETED------------------

---

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 What is Material management (SAP-
MM)
SAP MM is the short form of SAP materials management module. SAP MM is one of the
functional modules which supports all the aspects of material procurement i.e., purchasing,
stock handling, i.e., inventory management (IM) and logistics invoice verification (LIV).
MM is the backbone of logistics.
MM modules integrates with other modules such as SD, FI, CO, QM, PP, PM, PS, and
WM. MM as a process ensure no shortage of material or any gaps in supply chain of the
company. The business process or procurement process of MM is P2P cycle.
P2P stands for procurement 2 pay.

MM integrates with other Modules

PM – Plant PS –
PP – SD – Sales &
Maintenance Project
Production Distribution
System
planning

Material
Management

Page 40
QM – Quality FI - Finance ofW1M91 –
Management Warehouse
management
 CO -
Controlling

P2P – PROCUREMENT 2 PAY

Any dept required
Contracts
material/services

Purchasing RFQ – Price

Source
requisition Request for Quotation Comparison
Determination
(PR) Quotation Statement

FI Purchase
Invoice Goods Receipt
Payment
Receipt (IR) Note (GRN) Order
(PO)

OK Not OK

Store/WM Quality
Reject
Check

P2P overview
Procurement process starts with purchase requisition and end with goods receipt and
payments.
Whenever any department requires materials or services to fulfil their business needs then
they will raise a request document called purchase requisition (PR). PR is an internal
Page 41 of 191
purchasing document which will be used to request materials to purchasing dept. once
purchasing dept receives the request then will search vendor (supplier) in market called
source determination. Once we get the source then we will raise price request to vendor
called RFQ (Request for Quotation). RFQ will be created to vendor to known the price,
terms and condition offered by vendor. Vendor will submit price, terms and condition in
the form of a document called quotation. Once we receive quotation from multiple vendors
then purchasing department will compare the prices (Quotations) to finalize the vendor.
The process of comparing prices and finalizing vendor is called price comparison
statement. Once vendor is finalized then the purchasing department will raise order called
purchase order (PO).

P2P overview
Purchase order is an order document issued by purchasing department to the vendor for
procurement of material and services. In the PO we will maintain material requirement,
qty, delivery date, price and other terms and conditions. Once vendor receives the order
than based on delivery date, he will deliver the goods to company and company will
perform goods receipt (GR). Once company receives the material physically then goods
receipt will be post in SAP. After GR immediately our quality team will check the quality
of material if everything looks ok then we will move to storage location or if is not ok then
will reject the stock. Vendor will submit invoice to company for payment called invoice
receipt (IR). Company once receives the invoice then they will compare invoice with
goods receipt document and purchase order (3-way match) if all are matching then they
will submit the invoice to FI department for payment. Verifying invoice before making
payment is called logistic invoice verification.

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 Terms of Material Management

MM deal with following terms

Purchasing

Terms of Inventory Management

Logistics invoice

Components of MM along with T.

codes

Components T. codes
Purchase requisition (PR) ME51N
RFQ ME41
Quotation ME47
Price Comparison Statement ME49
Purchase Order ME21N
Goods Receipt MIGO
Invoice Receipt MIRO

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 Purchasing
Purchasing is one of the components in SAP MM (MM – PUR). Purchasing concept will
be used to procure materials and services from vendor/supplier to fulfil business
requirements. The process of buying materials and services from vendor or dealers is
called purchasing. Types of purchasing:
We have below different types of purchasing in SAP MM:

Standard procurement
Types of
purchasing
Special procurement

Standard Procurement
Procurement process is used to procure materials and services and required by the
company from external vendor. In this standard procurement company orders goods to
vendor and vendor supplies the good to company (one to one relation). Standard
procurement process low is as below:

Purchase Purchase Create Price Create PO

Quotation
requisition requisition RFQ wrt comparison wrt PR
release PR

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Release
 Invoice
GR WRT PO
receipt

**RFO/Quotation/PC are not mandatory in SAP, project to project requirements will

change.
*WRT – With reference to.

Types of purchasing document

Internal Purchase Requisition (PR)

Purchasing
Document RFQ – Request for Quotation
External

PO – Purchase Order

Contracts

Scheduling Agreement

PR – purchase Requisition
PR is the first purchasing document in SAP purchasing component.
It is an internal document.
If any department in the company required material or services then those departments.
will raise request to purchasing department in the form of a document called PR –
purchase requisition to procure the same in market.

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PR can be standard, Third party, Subcontracting, Stock transfer order (STO), Consignment
and services.

PR – Business Requirements
Project Requirement:
In real time project client’s internal departments will create purchase requisitions. We
consultants have to provide solution to differentiate department wise PRs in SAP system.
Example HR department, Sales, Purchasing, Stores, Design, Manufacturing, Maintenances
Et…

PR – consultant role
Under this heading we will learn consultant’s role in PR. They are.
 Define document type.
 Define number range to PR document type.
 Field selection of PR.
 Item categories.
Define document types:
Document types differentiates types of PR’s SAP by generating PR number to each PR.
SAP as defined standard document type.
NB – Standard purchase Requisition.
We consultants may use standard document type NB or we can customize types by coping
standard. In real time project we will customize below document types and these are just
examples. Project to project requirements may get change but the process is same.

PR – consultant role

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We consultants can use standard document type NB or we can customize new document
types by coping standard. In real time project we will use below document types and these
are just examples:
 ZSPR – Sales PR’s.
 ZHPR – HR PR’s.
 ZMFP – Manufacture PR’s.
 ZSTR – Store PR’s.
 ZMNT – Maintenance PR’s.
 ZPPR – Purchasing PR’s Etc.

Path:
SPRO→ IMG→ Material Management→ Purchasing→ Purchase Requisition→ Define
document type→ Enter→ Click on position→ Select NB line→ Click on copy icon→
Give your own document type (4 CHAR) → Maintain description→ Press enter→ Then
click copy all→ Continue and save it.

PR – Consultant Role
Document type controls PR**
Types of controls by document type:
 It controls number range of PR.
 It manages fields of PR.
 It allows item category.
Define number range for PR:
Number range will be used to identify PRs in SAP system. In SAP standard we can create
and assign internal and external number range for each document type. (Same like
material type).
PR number range length is 10 digits.
T. code – OMH7.
Path:
SPRO→ IMG→ Material Management→ Purchasing→ Purchase Requisition→ Define
number range→ Enter→ Click on change intervals→ Insert 2 lines→ Give serial

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number→

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Maintain from and to number range→ For both internal and external→ Press enter→ Save
it→ Go back to PR document type screen→ Enter→ Click on position→ Give your own
document type→ Enter→ Assign serial number range→ press enter and save it.
Define field selection of PR:
As we are aware field selection will be used to manage fields of PR. In SAP standard each
document type will have one field selection.
SAP has defined standard field selection NBB for PR. We can use standard field selection
or we can customize our own based on document type. (If we customize document type
then customize field selection also).
Document type+ number range (inter/external) +field selection+ item category =
consultant role in purchasing.
Path:
SPRO→ IMG→ Material management→ Purchasing→ Purchasing requisition→ Define
screen layout at document level→ Enter→ Click on position→ Give standard field
selection (NBB) → Select NBB line→ Click on copy icon→ Give your own field
selection (4 CHAR) → Maintain description→ Then press enter→ Double click on your
own field selection→ Double click on filed selection group→ Manage field of PR→ Then
go back 2 times→ And save it→ Then go back define document types screen→ Enter→
Click on position→ Give your own PR document type→ Enter→ Assign your own field
selection→ save it.
Item category:
Item categories will be controlled by document type. Item category differentiates types of
procurement in SAP system. SAP has designed below standard item categories for
purchase and we consultant don’t have any option of adding new item categories.
Types of item category:
 Blank – Standard.
 S – Third Party.
 L – Subcontracting.
 U – stock transfer order (STO).
 K – Consignment.
 D – Service.
Structure of purchasing documents:
All the purchasing documents in SAP divides into multiple structures. They are:

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 Header data.
 Item overview.
 Item data.
The data maintained at header level is applicable to whole document.
In item overview we have to maintain list of materials to be procured.
The data maintained at item level is applicable only to particular lines items. Material to
material item data will be different, for every material we need to maintain item data.
Client role in purchase requisition:
Under this heading we will learn how to create purchase requisition manually. But in real
time project client internal department will create the PR we consultant train them.
Creation purchase requisition manually.
T. code – ME51N.
Path:
SAP access screen→ SAP Manu→ Logistics→ Material Management→ Purchasing→
Purchasing Requisition→ ME51N→ Create→ Enter→ Select Document type.
PR item overview:
Under this heading we will add all required materials, quantity along with below
information.
1. Item:
In this field system will generate line-item serial no’s automatically (ex: 10,20,30…)
2. A- Account assignment category:
If we are procuring materials for direct consumption (use) then we have to maintain
account assignment category. Please find below are few standard account assignment
categories.
 Assets.
 Sales order.
 Third party.
 E- customer individual requirement.
 F- Order.
 K- Cost center.
 N- Network.
 P- Project.
 Q- Project, makes to order.

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As of now leave this field blank because we are creating stock PR.

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3. I- Item category: Maintain item category (blank standard).
4. Maintain required material code.
5. Short text: In this field system will copy material description from material master.
6. Maintain PR Quantity.
7. UOM- Unit of measurement:
In this field system will copy UOM from material master basic data.
8. Delivery Date:
In this field we have to maintain material required date, if we leave this field blank then
then system will take PR creation data as delivery date.
9. Material group:
In this field system will copy material group from material master.
10. Maintain plant and storage location.
11. purchasing group:
In this field system will copy purchase group from material master.

PR header data:
The data maintain in header level is applicable to entire purchasing requisition.
Tab 1- Text tab:
In this field we can maintain any PR information (or) instruction in the form of text.
PR item data:
Item data will be maintained for every material line available in PR item overview.
1. Tab 1: - Material data:
In this tab we can check material details.
2. Tab 2: - Quantities & Dates:
In quantity, quantity ordered, open quantity.
In this quantities field we will maintain required quantity or it will copy from item
overview. If we convert PR into PO then PO quantity will get update in quantity ordered
field automatically and remaining quantity of PR after order will get update in open
quantity field. Closed:
If we want to close the purchase requisition line item from purchase then activate this filed
manually.
3. Tab- 3: -Valuation Tab:
1. valuation price:

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In this filed system will copy maintain price from material master.
2. Goods receipt: This field is in activate by default copied from item category. If this
filed is in active then system will export goods receipt enter in SAP.
3. Invoice receipt:
If this field is in active then system will allow to enter invoice receipts.
4. Tab- 4: - Source of supply:
Assign source of supply:
If we click on this filed ten system will copy vendors in following sequence.
QAL→ Source list→ Contracts→ PIR.
5. Tab-5: - Status Tab:
In this tab we can check PR current status.
6. Tab- 6: - Contact person:
In this tab we can check PR created details.
In this tab system will copy text from material master. If required we can add new text here
which will copy to purchase order automatically.
7. Tab-7: -Delivery address:
In this tab system will copy delivery address from plant address and if required we can exit
field for delivering physical material by vendor.
After maintaining all required tabs and fields click a check icon. If system displays no message
issued during check, then click on save icon to save the PR and system will display PR
number in left bottom of screen.
T. code of tables of purchase requisition:
 ME51N→ Create Purchase Requisition.
 ME52N→ Change Purchase Requisition.
 ME53N→ Display Purchase Requisition.
 ME54N→ Release Purchase Requisition. (individual)
 ME55→ Release PR-collectively.
 ME5A→ List of PR’s.
 ME5K→ List of account assignment PR’s.
 ME5J→ Project PR’s.
 MEMASSPR→ Mass maintenance.
Tables-SE16N:
 EBAN→ General Purchase Requisition.

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  EBKN→ Account assignment PR’s.

-----------------------------PURCHASE REQUISITION TAPIC COMPLETED----------------

--

RFQ – Request for Quotation

 RFQ is one of the external purchasing documents.
 RFQ is a form of invitation sent to vendor thru email, fax or telephone to submit the
price, term & condition for required material.
 RFQ contains details of a required materials, quantity, date of delivery, place of
delivery and quotation submission last date.
 RFQ is used to know the price, term & condition offered by the vendor for a
material.
RFQ- Business requirements:
In real time project clients requires quotations to different types of vendors such as
domestics have provided solution to differentiate types of RFQ’s in SAP system.
RFQ- Consultant role:
Define document types:
As discussed in PR document types differentiates types of RFQ’s in SAP by generating RFQ
number to each RFQ. SAP has defined standard document type.
AN-RFQ
We consultants can use standard document type AN or we can customize new document types
by coping standard. In real time project we will use below document types and these are
just examples.
 ZDRQ- Domestic RFQ.
 ZIR- Import RFQ.
 ZSR- service RFQ etc.
Path:
SPRO→ IMG→ Material management→ Purchasing→ RFQ/Quotation→ Define document
types→ Enter→ Select AN line→ Click on copy as icon→ Give your own document types
(4 CHAR) → Maintain description→ Press enter→ Click copy all→ Click on continue→
Save it.

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RFQ- Consultant role:
Document type controls RFQ**
Types of controls by document type:
 It controls number range of RFQ.
 It manages field of RFQ.
 It allows item category.
Define RFQ number ranges:
As discussed in PR, each document type will have 1 internal and 1 external number.
Number range will be used to identify RFQ’s in SAP system.
T. code –
OMH6. Path:
SPRO→ IMG→ Material management→ Purchasing→ RFQ/Quotations→ Define
number ranges→ Enter→ Click on change intervals→ Insert 2 line→ Give serial
number→ Give from and to number range→ And both internal and external→ In bracket
(10 CHAR) → Press enters and save it→ Go back RFQ document type screen→ Enter→
Click on position→ Give your own RFQ document type→ Assign number range serial
number→ Press enter→ Save it.
Define filed selection for RFQ:
As we are aware field selection will be used to manage field of RFQ. SAP has defined
standard filed selection ANA for RFQ standard document type. We can use standard or we
can customize our own filed selections same like document types.
Path:
SPRO→ IMG→ Material management→ Purchasing→ RFQ/Quotation→ Define screen
layout at document level→ Enter→ Click on position→ Give standard field selection
ANA→ Select ANA line→ Click on copy as icon→ Give your own filed selection→
Maintain description→ Enter→ Double click on own field selection→ Double click on
field selection group→ Manage the filed RFQ→ Go back 2 time→ Save it→ Go back to
RFQ document type screen→ Click on position→ Give your document type→ Enter→
Assign your own field selection→ Save it.
Client role in RFQ:
Under this heading we will learn how to create RFQ’s and in real time project clients
purchasing department will create RFQ’s and we MM consultants have to provide
training. Possibilities of creating RFQ’s:

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We can create RFQ’s following ways:
 RFQ WRT PR
 RFQ WRT outline agreement (contracts).
 RFQ without any reference.

Creating of RFQ WRT PR:

If we create WRT PR then system will copy data from PR to RFQ screen automatically.
We can create multiple RFQ’s to multiple vendor WRT one PR.
T. code- ME41.
Path:
SAP easy access→ SAP Manu→ Logistics→ Material Management→ Purchasing→
RFQ/Quotation→ RFQ→ ME41→ Create→ Enter.
Create RFQ – Initial screen:
1. RFQ type:
In this filed we have to select RFQ document type.
2. Language key: EN (English).
3. RFQ date:
In this filed we have to maintain RFQ request date.
4. Quotation Deadline:
In this filed we have to maintain last date of quotation submission.
5. RFQ:
In this filed we have to maintain RFQ number manually if we are using external number
range or else leave this filed blank if we are using internal number range.
6. maintain purchasing org and purchasing group.
7. Click on reference to PR icon.
8. maintain PR number- press enter.
RFQ- Header data:
1. Collective no:
In this filed we can maintain any serial no. just to identify sequence of RFQ’s created.
press enter
1. sytstem will display PR line item.
2. Select PR line item then click on Adopt+ details icon.
3. maintain delivery date which should be greater than quotation deadline date- press enter.

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 4. Now we can see data copied from PR to RFQ screen.
5. Click on vendor address icon.
6. Give vendor code to whom we are requesting quotations.
7. Press enter and save the RFQ.
8. System will generate RFQ number at left bottom of the screen.
After creating RFQ’s client will take the RFQ printout from SAP they will share with vendor
via emails.

---------------------REQUEST FOR QUOTATION TAPIC COMPLETED-----------------

--

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 Quotation
After requesting quotations to vendor by using RFQ document. In reply to RFQ vendor
will submit quotations thru emails, fax, courier, or directly vendor will submit in
company’s purchasing department.
Quotation contains price, term & conditions of the material offering by the vendor to
company.
As below t. code or path to maintain quotation in SAP.
T. code- ME47
Path:
SAP easy access screen→ SAP Manu→ Logistics→ Material Management→
Purchasing→ RFQ/Quotation→ Quotation→ ME47 maintain→ Enter→ Give RFQ no→
Select RFQ line item→ Click on item condition as icon→ Maintain gross price, discount,
freight charges→ Go back→ And save it.
 ME47- Maintain/ change quotations.
 ME48- Display quotation.
Price comparison statement:
After maintain quotation of vendor we will use price comparison concept to compare the
quotation.
Price comparison will do by purchasing dept in the company.
T. code- ME49
Path:
SAP easy access screen→ SAP Manu→ Logistics→ Material management→
Purchasing→ RFQ/Quotation→ ME49 price comparison→ Enter→ Give your PO no→
And maintain RFQ no Quotation field→ Activate Include discount, include delivery
cost→ And execute→ Check the price comparison statement→ And finalised the vendor.

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 Note: In SAP system vendor will be finalised based on price not based on quantity and
discipline of the vendor.

T. code & Tables of RFQ

ME41→ Create RFQ.
ME42→ Change RFQ.
ME43→ Display RFQ.
ME45→ Release RFQ.
ME4M→ List of RFQ’s by material.
ME4L→ List of RFQ’s by vendor.
ME4C→ List of RFQ’s by material group. Tables -SE16N
ME4S→ List of RFQ’s by collective number. EKKO→ Purchasing header data.
ME4N→ List of RFQ’s. EKPO→ Purchasing item data.
**Above table will store all the external
ME9A→ RFQ print.
purchasing documents data including RFQ.
(PO, Contract, Scheduling agreement and
RFQ).

------------------------------------QUOTATION TAPIC COMPLETED------------------------

--

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 PO- Purchasing Order
Purchase order is also called as order document. If we want to procure material and
services then will place order to vendor in the from document called purchase order.
Possibilities of creating PO:
In standard SAP we can create po in following ways:
 PO WRT PR.
 PO WRT RFQ.
 PO WRT contracts.
 PO WRT PO.
 Manual creation of PO. (W/O any reference)
Types of purchasing order in SAP:
We have below different types of purchasing order in SAP standards.
 Standard PO
 Third party PO
 Subcontracting PO
 Consignment PO
 Stock transfer order (STO)
 Service order.
Business requirement:
In the real time project client creates different types of purchase order such as standard
PO, domestics PO, import PO, third party PO, subcontracting po, service PO, consignment
PO, STO etc. we consultants have to provide solution to show PO difference in SAP
system.
Consultant role in purchase order:

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1. Define document type:

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As discussed in PR and RFQ document types will differentiate types of purchasing in SAP
by generating different number to each purchase order.
SAP as define standard document type NB for PO; we consultants can use standard
document type or we can customize our own by coping standard.
Real time project document type examples:
 ZDMP- Domestic purchase.
 ZIMP- Import purchase.
 ZSC- Subcontracting- ZSUB.
 ZTHP- Third party purchase.
 ZSER- service purchase.
 ZCON- Consignment PO.
 ZCAP- Capital purchase.
 ZSPR- Spares purchase.
 ZCPO- Consumables PO etc...
**Company to company PO types may be different.
Path:
SPRO→ IMG→ Material management→ Purchasing→ Purchasing order→ Define
document type→ Enter→ Click on position→ Give NB document→ Select NB line→
Click on copy icon→ Give your document type (4 CHAR) → Maintain description→
Press enter→ Click on copy all→ Then continue→ Save it.
*Document type control purchase order:
Types of controls by PO document type:
 It controls number range of PO.
 It controls field selection of PO.
 It allows item category.
Define number range of PO:
As discussed in PR and RFQ each document type will have 1 internal and 1 external
number range. Number range will be used to identify purchase orders in SAP.
T. code-
OMH6 Path:
SPRO→ IMG→ Material management→ Purchasing→ Purchase order→ Define number
ranges→ Enter→ Click on change intervals→ Insert 2 line→ Then give serial number→
Give from and to number ranges→ And both internal and external (10 CHAR) → Press

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enter→ Save it→ Go back to define document types screen→ Enter→ Click on position→
Give your own document type→ Enter→ Assign your number range serial number→
Press enter→ save.
Define filed selection of PO:
As we are aware field selection will be used to manage fields of PO. SAP as defined
standard field selection NBF for purchase order. We can use NBF or we can customize
new field selections by copying standard.
Path:
SPRO→ IMG→ Material management→ Purchasing→ Purchasing order→ Define screen
layout at document level→ Enter→ Click on position→ Give standard field selection→
Select NBF line→ Click on copy as icon→ Give your filed selection (4 CHAR) →
Maintain description→ Press enter→ Double click on your own filed selection→ Double
click on filed selection group→ Manage the field of purchase order→ Go back 2 time→
Save it→ Go back to PO document type screen→ Enter→ Click on position→ Give your
own document type→ Enter→ Assign your own field selection→ Save it.
Client role in purchase order:
Under this heading we will learn how to create purchase order but in real time project
purchasing department end user will create the order and we consultants have to providing
training.
Creation of purchase order (PO) WRT PR:
If we create order WRT PR then system will copy data from PR to PO screen and we can
edit the data if required save the PO.
T. code- ME21N- create the purchase order:
Steps:
 Go to T. code- ME21N.
 Select document type based on type of purchase. (NB or new document type).
 Maintain vendor code to whom we are placing the order.
 Maintain purchasing org, Purchase group, and company code.
Press enters
PO item overview:
 Drag item overview screen to right and maintain PR number→ Press enters.
 System will copy data from PR to PO screen.
 Maintain the required filed like purchase price, delivery date and other required fields.

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  Click on check icon and save the PO.
Notes:
We can create multiple purchase orders WRT one PR till PR quantity becomes 0.
We can create 1 PO WRT to multiple PR’s if we are buying all PR products with same vendor.
Creation of purchase order W/O any reference:
Under this heading we will learn how to create purchase order W/O any reference document.
When we are not using any reference document then we have to maintain all the
information in PO manually.
T. code- ME21N Path:
SAP easy access screen→ SAP Manu→ Logistics→ Material management→ Purchasing→
Purchase order→ Create ME21N→ Enter.
 Select document type based on type of purchase. (NB or new document type).
 Maintain vendor code to whom we are placing the order.
 Maintain purchasing org, Purchase group, and company code.
Press enters
PO item overview:
Under this item overview we will maintain list of required materials, qty, delivery, date
along with below detailed information.
1. Item:
In this filed system will generate line-item serial no’s automatically (ex: 10, 20, 30...).
2. A- Account assignment category:
If we are procuring materials for direct consumption (use) then we have to maintain account
assignment category. Please find below are few standard account assignment categories.
 A- Assets.
 C- Sales order.
 1- Third party.
 E- customer individual requirement.
 F- Order.
 K- Cost center.
 N- Network.
 P- Project.

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  Q- Project, makes to order.
3. I- Item category:
Maintain item category (Blank – standard).
4. Maintain required material code.
5. Material description:
In this filed system will copy material description from material master.
6. Maintain PO quantity.
7. OUN- Order unit:
In this filed system will copy order unit from PIR or from material master.
8. Delivery date:
In this filed we have to maintain material required date. If we leave this filed blank then
system will take PO creation date as delivery date.
9. Maintain net price.
10. Currency will copy from PO header data – invoice tab.
11. Material group:
In this filed system will copy material group from material master.
12. Maintain plant and storage location.
13. Info record:
In this filed system will copy info record number automatically if we maintain info record for
the PO vendor and material. System will copy data from info record to PO screen if info
record is available.
14. R – Return item:
If we want to return materials back to vendor by creating return purchase order then activate
this field. If we activate this field then standard purchase order will become return
purchase order.
If we are buying materials then leave this filed blank.
15. F – Free items:
If we are getting any materials free from vendor then activate this filed.
16. purchase requisition and requisition item:
In this field we will give PR number if we want to create PO WRT PR.
17. Outline arrangement and contracts item:
In this field we will maintain contacts number and contracts item if we want to create PO WRT
contracts.

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18. RFQ and RFQ item:
In this filed we will maintain RFQ and item number if we want to create PO WRT RFQ.
19. Purchasing and item:
In this field we will maintain PO number if we want to create PO WRT PO.
PO Header data:
The data maintained at PO header level is applicable to entire purchase order.
1. Delivery/Invoice tab:
Payment term/ incoterms/ currency:
in this filed data will copy from vendor master and if required we can edit here.
Exchange rate:
It orders currency and company code currency are different then system will copy
currency exchange rate from OB08 T. code.
In this OB08 T. code FI consultants will maintain currency exchange rate.
Ex. 1 USD = 80 INR
2. Condition tab:
In this tab we can check total PO value.
3. Texts tab:
In this tab we can maintain any information in the form of text by selecting text types (left
side of the tab).
4. Address tab:
In this tab system will copy address from vendor master.
5. Communication tab:
Salesperson/telephone:
In this filed system will copy data from vendor master.
6. Partners tab:
In this tab we can maintain partners and their vendor codes if multiple people are
involving in purchase.
7. Additional data tab:
In this tab we can maintain purchase order valid dates.
8. Org. data tab:
In this tab we have to maintain org levels like purchasing and company code.
9. Status tab:

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In this tab we can check current status of PO like quantity ordered, delivered or invoiced
quantity.
10. Payment processing tab:
DP category:
If we want to make down payment (advance payment) to vendor then in this field select
option M – Mandatory down payment→ maintain down payment percentage, maintain due
date.
PO item data:
As we are aware the data maintained in item tabs are applicable in individual line items.
Every line-item data is mandatory.
1. Material data :
In this tab we can check material information.

2. Quantities/ Weight tab:

In this tab we can check ordering quantity copied from item overview.
3. Delivery schedule tab:
In this tab we can maintain multiple delivery dates for a single material.
4. Delivery:
Overdeliver. Tol. /Underdeliver. Tol. / Unlimited overdelivers tolerance/1st, 2nd, 3rd rem./
Expend:
Will copy from PIR or from material master.
Delivery completion:
If we don’t want to receive material quantity from vendor then activate this filed manually.
If we activate this filed then system will treat delivery is completed.
5. Invoice tab:
Invoice receipt:
In we activate this field then system will expect to enter invoice document in SAP system.
Final invoice:
If we activate this field then system will not expect any further invoices from the vendor.
After activating this field, we can post only one invoice.
Against PO and that invoice will become final invoice.
GR- BSD INV:
This filed will copy from PIR or else from vendor master.

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Tax code:
In this filed tax code will copy from PIR or we can maintain here to calculate taxes on
purchase.
6. Conditions tab:
In this tab we can maintain material purchase prices.
7. Texts tab:
In this tab system will copy text from material master, PIR, purchase requisition etc... if
required we can maintain text here in PO by selecting text types (left side of the tab).
8. Delivery address tab:
In this field system will copy delivery address from plant address. If required we can edit
the address. In this address vendor will supply the materials.
9. Confirmation tab:
Acknowledgment required:
This field will copy from PIR or else from material master.
10. Condition control tab:
Print price:
If we don’t want to print material price on PO print out then deactivates this field.
After maintaining all required fields and tabs we will design output determination before
saving the PO.
11. Retail tab.
PO output determination:
 Go to message icon.
 Maintain output type- NEU→ press enter.
 Select output line→ click on communication method icon.
 Maintain logical destination – LP01 (default printer).
 Activate print immediately.
 Maintain no of message 1 copy.
 Go back→ go back.
 Click on print preview icon and check the PO printout.
 Click on check icon and save the purchase order.

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 T. codes & Tables of purchase Order
 ME21N- Create Purchase Order.
 ME22N- Change Purchase Order.
 ME23N- Display Purchase Order.
 ME28- Release Purchase Order collectively.
 ME29N- Release Purchase Order individually.
 ME9F- PO print.
 MEMASSPO- Mass maintenance. Tables- SE16N
 ME2L- List of Purchase Order by vendor.  EKKO- Purchasing Header data.
 ME2M- List of Purchase Order by material.  EKPO- Purchasing item data.
 ME2K- List of account assignment PO’s.  EKBE- Purchasing history.
 ME2J- List of project Purchase Order.  EKKN- Account assignment
 ME2C- List of Purchase Order by material group. purchasing.
 ME2N- List of Purchase Order.  EKET- Purchasing schedule
 ME1P- Purchase Order History (POH). lines (Delivery dates).
 EKPA- Purchasing partner roles.

------------------------------PURCHASE ORDER TAPIC COMPLETED------------------------

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 Inventory management
Inventory management is a sub module in SAP MM it’s component of SAP MM-IM.
Procurement process starts with purchase requisition and ends with goods receipt from
vendor. After receiving goods from vendor, they need to be stored under companies’
location (storage location) so that we ca use whenever we required. Inventory management
deals with placing and handling stock received from vendor.
Points to be noted in inventory:
 IM deal with managing stock either quantity or value basis.
 Goods movement creates a document which updates quantity and value in the
inventory books called material document.
 Material document number range length 10 digits.

Terms of inventory management:

IM deals with following terms.
Movement types

Goods receipt (GR)

Terms of IM

Reservation

Goods issue (GI)

Movement types:
 Each and every goods movement will be capture with ethic digit code called
movement types.
 Movement types help to identify good movement direction.
 SAP define below standard movement type which using real time project also.

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Movement types- OMJJ

 101- Goods receipt WRT PO.

 102- Cancel GR.
 103- GR WRT PO to blacked stock.
 105- Release from GR blocked stock.
 122- Return delivery to vendor.
 124- Return delivery to vendor from GR blocked.
 161- Goods return to vendor WRT return PO.
 201- Goods issue to cost center.
 202- GI cancelation.
 221- GI to project.
 251- Goods issue to sale (W/O sales order).
 261- Goods issue for an order.
 281- Goods issue to network.
 291- Goods issue to any account assignment.
 301- Plant to plant stock transfer 1 steps.
 303- Plant 2 plant stock transfer 2 steps (stock removal).
 305- Plant 2 plant stock transfer 2 steps (stock put away).
 309- Transfer posting from material to material.
 311- Storage 2 Storage stock transfer 1 steps.
 313- Storage 2 Storage stock transfer 1 steps (stock removal).
 315- Storage 2 Storage stock transfer 1 steps (stock put away).
 321- Transfer of stock from inspection to unrestricted.
 351- Goods issue to STO (without shipping).
 411- Transfer of special stock own stock.
 411 K- Transfer of consignment
 to own stock.
 451- Return from customer (without shipping).
 501- Goods receipt W/O Purchase order.
 502- Cancel GR.
 541- Stock issue to subcontracting.
 543- Stock consumption of subcontracting.
 545- Goods receipt of by- product from subcontracting.
 551- Scrapping from unrestricted use.
 553- Scrapping from inspection stock.
 555- scrapping from blocked stock.
 561- Initial stock upload.
 581- Goods receipt of a byproduct for network.
 601- Goods issue to delivery.
 641- GI to STO (shipping)- intra 2 step.
 643- GI to STO (shipping)- inter 2 steps.
 645- GI to STO (shipping)- inter 1 step.
 647- GI to STO (shipping)- intra 1 step.
 651- Returns from customer (shipping).
 657- Returns from customer to blocked stock (shipping).
 701- Inventory difference (physically inventory).
 702- Inventory difference (physically inventory).

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 Goods receipt (GR)
Goods receipt will be performed when the material is produced from production department or
goods are procured from external vendor and placed in storage location. When we perform
GR material quantity stock will increase.
Goods receipt is also called inwards movement of material.

Effects of Goods receipt

Quality
WM stock T. Inspection
code – LX02 Lot

System will
Goods Receipt (GR) update PO
system will
status tab in
update MAP in
header
acc 1 view

Accounting PO history
Material
Batch stock in document will update
document
MMBE

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 Goods movement document

Goods receipt Goods movement Goods issue

Material Accounting
Document
document document

Consultants’ role in inventory management:

1. Define document types:
T. code – OBA7
 WE- Goods receipt.
 WA- Goods issue.
 IB- Physically inventory.
 RE- Invoice receipt.
In real time project we will use only standards no need to customize new document types
for inventory and invoice.
2. Define number range:
As we know when we do any goods movement system will generate material and
accounting document. So, we have to define number range for both.
Define material document number range:
Material document number range will be created by MM consultants and accounting
document number range will be created by FI consultants in real time project.
Material document will be used to identify the goods movement and accounting document
records the changes in the values in a company code arising from accounting transactions.
Material and accounting document number range length is 10 digit and internal number
range.
T. code- OMBT – Material number range:
Path:

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 SPRO→ IMG→ Material management→ Inventory management and physical
inventory→ Number assignment→ Define number assignment for material and phys. Inv.
Docs→ Enter→ Click on maintain group→ Click on create icon→ Give group name→
Give from and to number range and along with current year→ Press enters→ Save it→ Go
back→ Click on CTRL+F→ Give document type (WE,WA,IB,RE) → Press enter→ Click
on document type→ Click on element/group→ Search your number ranges group→ And
double click on your number range→ And save it.
Define number range for accounting document:
As discussed, accounting document number range will be created by FI consultants in real
time project. Number ranges will be defined yearly once below series.
T. code- FBN1.
Path:
SPRO→ IMG→ Material management→ Inventory management and physically
inventory→ Number assignment→ Define number assignment for accounting document→
Enter→ Click on financial accounting number range→ Give your company code and
change intervals→ Insert line→ Give serial number→ Maintain current year→ Give from
and to number range→ Press enter→ And save it.

Inventory accounting number ranges:

S.NO YEAR FROM TO
GR 50 2022 5000000000 5099999999
GI/TP/other than GR 49 Current year 4900000000 4999999999
Invoice Receipt 51 Current year 5100000000 5199999999

Define field selection of goods movement:

T. code-
OMJN Path:
SPRO→ IMG→ Material management→ Inventory management and physically
inventory→ Field selection for goods movement Initial/ Header screen→ Enter→ Manage
the filed→ And save it.

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Client roles Goods receipt (GI):
Under this heading we will learn how to perform goods receipt but in real time project
store keeper will perform and we consultants will provide the training and user manuals.
Possibilities of goods receipt:
We can perform goods receipt following ways:
 GR WRT PO.
 GR W/O PO.
 GR WRT order (production module).
 GR WRT delivery (SD module – STO).
T. code:
 MIGO- Goods movement.
 MIGO- GR- Goods receipt.
Goods receipt WRT purchase
order:
Once we place order to vendor then he will supply physical products to the company as
per delivery date. Once we receive physical products then client’s store keeper will
perform goods receipt in SAP system. We can perform multiple times GR WRT one PO
till PO quantity becomes zero (0).
 Go to T. code- MIGO.
 Select event A01- Goods receipts.
 Select reference document R01 – Purchase order.
 Give movement type- 101.
 Give purchase order number.
-------------------------------------------------Enter-------------------------------------------------
System will copy data from PO to GR screen.
Header data:
1. General tab:
Document data:
In this filed we have to enter delivery challan data.
What is delivery challan (DC):
Delivery challan (DC) is a supporting document given by the vendors at the time of goods
delivery. in this DC we can see the details of material, quantity etc...
Posting data:

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In this field we have to maintain system entry data. As per SAP we can use current month
dates and previous month dates as posting dates.
Delivery note:
In this field we have to capture delivery challan number.
Bill of loading:
It is also a kind of delivery document given by the foreign vendor customs.
Vendor:
In this field system will copy vendor from PO.
Header text:
In this field we can maintain any information in the form of text.
2. Vendor tab:
In this tab system will copy vendor from PO.
3. Doc. Info tab:
In this tab we can check accounting document in display mode not in creation mode.
Material tab:
In this tab we can check material details copied from PO.
Quantity Tab:
In this tab we have to maintain physically received quantity from vendor in field Qty in
Unit of Entry.
Where Tab:
In this tab we have to maintain following details.
 Movement type - 101
 Plant will copy from PO.
 Storage location will copy from PO if we maintain or else, we can maintain manually
here.
Goods recipient:
In this field we will capture store keeper name who received physical products.
4. Purchase Order Data:
In this tab we can check PO details.
5. Partner:
In this tab we can check goods supplier partner or vendor code.
6. Batch:
In this field system will generate Batch no. automatically based on batch settings. Batch

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 number will generate when we click on check icon.
Date of Manufacture:
In this field we have to maintain material manufacture date. This date we
will get it on product packing.
After maintaining all required fields and tabs then activate ITEM OK check box then click
on check icon and if document is OK then POST. Once document is posted system will
generate material document and accounting document. (We can check accounting
document only in display mode).

How to check accounting document after goods movement:

As we know once we post goods movement in SAP system at backend system will
generate accounting document for FI.
Use below steps to check accounting document:
 Go to T. Code - MIGO
 Select event - Display
 Select reference document material document
 Maintain material document number (GR/GI etc) then press enter
 Go to doc.info tab
 Click on FI document options
 Double click on accounting document and check the accounting entries.

GR WRT PO accounting entries are as below:

 BSX - Inventory A/c - Dr (+)
 WRX - GR/IR clearing A/c - Cr (-)
 FR1 - Freight charges A/c -Cr. (-) ——— (only if we maintain freight in PO).

--------------------------- Goods receipt WRT purchase order topic completed------------------

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 logistics invoice verification (LIV)
Logistics invoice verification is a part of P2P cycle. It is situated at the end of
procurement that includes purchasing and inventory management.
Every company required materials and services to fulfil their business needs. Once
materials are purchased from vendor. Then those material will store in company’s location
thru goods receipt. We need to make payment for received goods to the vendor. The
amount to be paid along with the details of material, qty will be provide by vendor in the
form of document called invoice/bill. Before making the payment, we will verify the
invoice with PO and GR. (it is called as 3 phases in MM) the process of verifying invoice
before making payment is called logistics invoice verification.
Points to be noted in invoice verification:
 Invoice verification marks the end of procurement after PO and GR.
 Invoice posting updates all finance documents.
Terms of LIV:
LIV deals with following terms:
 Posting invoice.
 Blocked invoice.
Consultant role:
1. Define number range for invoice posting.
T. code- OMRJ.
Path:
SPRO→ IMG→ Material management→ Logistics invoice verification→ Incoming
invoice→ Number assignment→ Maintain number assignment for logistics document→
Maintain number range intervals for invoice documents→ Enter→ click on change
intervals→ Insert a line→ Give your serial number, Maintain year→ Give from and to
number range (10 digit) → Press enter→ And save it→ Go back 2 times→ Transaction-
Assign number range→ Enter→ Assign your number range serial number in RD, RS
transaction→ Press enter→ Save it.
Clients’ role in invoice posting:
Post vendor invoice:
Posting of vendor invoice will be done after goods receipt. The invoice received from the

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vendor will be verified with cost, quantity. Quality. If all are matching then clients will
enter invoice in SAP system against PO.
T. code: MIRO
Path:
SAP easy access→ SAP Manu→ Logistics→ Material management→ Logistics invoice
verification→ Document entry→ MIRO- Enter invoice→ Enter→ Give your company
code→ Press enters.
Invoice header:
Basic data:
Invoice date:
In this field we have to maintain invoice date maintained on invoice copy.
Posting data:
In this field we have to maintain invoice entry date in SAP system.
Reference:
I this field we have capture invoice number.
Payment tab:
Base line date:
In this filed we have to maintain payment due date.
Payment block:
In this field we have to select blocked for payment option if we want to back invoice or
else select free for payment option (no block).
Details tab:
1. unpl del csts**:
What is delivery cost??
The amount spends on procurement of material other than material price is called delivery
cost.
Ex: Freight charges, Loading and unloading charges, packing charges etc...
We have 2 types of delivery cost:
 PDC- Planned delivery cost.
 UDC- Unplanned delivery cost.
1. Planned delivery cost:
If the delivery cost is maintained at PO level in condition tab, then it is called planned
delivery cost which we know at the time of order.

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 2. Unplanned delivery cost:
If we don’t know the delivery cost at the time of order (PO) But we come know at the time
of invoice then it is called UDC. Unplanned delivery cost, we will maintain UDC in
details tab of invoice in unplanned delivery cost field. This will add to payment filed.
Tax tab:
In this tab we can check calculate tax amount.
Contacts tab:
In this tab we can check and user details who is responsible in posting invoice.
Go to item overview then click on PO reference tab and give PO number→ Enter→
System will copy data from PO to invoice screen based on goods receipt.
Go back to basic data tab:
 Select standard tax code VA or VO.
 Activate calculate tax check box to calculate tax amount.
 Copy balance and paste in amount filed.
 If balance amount becomes 0 with status indicator in green colour, then simulate and
post the
 invoice.
Note:
Once invoice is posted in SAP then purchasing dept end users will hand over the original
invoices to accounts department for payments.
LIV T. code:
 MIRO- Post vendor invoice.
 MIR4- Display invoice.
 MIR5- List of invoices.
 MIR6- Invoice overview.
 MIR7- Park invoice.
 MRBR- Release blocked invoice.
 MR8M- Cancel invoice.
 MR90- Invoice output.
LIV table- SE16N:
 RBKP- Invoice header.
 RSEG- Invoice item.
-------------------------logistics invoice verification (LIV) topic completed----------------------

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 2. Subcontracting process

Special procurement
The name itself indicates special procurement type procuring material either internally or
externally. In standard procurement vendor supplies goods to company after receiving
purchase order but in special procurement case it is not mandatory. Sometimes goods will
flow directly to customers, goods will be received from other plants within the company
etc...

Types of specials procurements:

 Third party process.
 Stock transfer order (STO).
 Subcontracting process – job work process.
 Consignment process.
 Pipeline process.

Subcontracting process:
Subcontracting is also called as job work is real time project. It is one of the special
procurements in SAP MM. in subcontracting process companies will send their own
components (any types of material) to outside vendor, outside vendor will convert those
components into another product (final product) and sends back to company. Vendor will
change payment for converting components into final products (another products).

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 subcontracting process flow

BOM- Bill of
Purchase Create PO Goods Issue to
Material Maintain PR
Requisition WRT PR Subcontractor
(optional)

Create
Subcontracting Goods Receipt
Invoice Delivery
Reconciliation WRT PO
Receipt Challan

End user steps involved in subcontracting process:

 Create BOM- CS01 (optional).
 Create subcontracting info record- ME11.
 Create purchase- ME51N (optional).
 Create purchase order- ME21N.
 Goods issue to subcontractor – MB1B/MIGO.
 Crate Delivery challan- J1IGSUBCON.
 Goods receipt (final project)- MIGO.
 Post vendor invoice – MIRO.
 Subcontracting reconciliation-J1IGRECON.

--------------------------special procurement topic completed----------------------------------------

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 Create BOM (Bill of Material)
BOM is used to maintain list of components required to manufacture finished products.
T. code:
Path:
Give final product code→ Maintain plant→ Maintain BOM usage 1→ Press enter→
Maintain item category L→ Maintain Qty, maintain valid date BOM→ Press enter→ And
save it.
 CS01- Maintain BOM.
 CS02- Change BOM.
 CS03- Display BOM.

-----------------------------------------BOM topic completed--------------------------------------------

Creation of subcontracting info record

Subcontracting info record will be created for final product and vendor combination.
 Go to T. code- ME11.
 Give vendor.
 Give material.
 Give purchase order.
 Give plant.
Select info category→ Subcontracting enter→ System will copy date from vendor if
required edit the information and save the info record.

------------------------- Subcontracting info record topic completed-------------------------------

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 Creation of subcontracting purchase order
We can create subcontracting PO WRT to PR or without any reference.
Consultant role:
 Define document type by coping standard NB.
 Define assign number range to document type.
 Define, manage and assign field selection to document type by copying standard NBF.
 Item category- L.
Client role:
 Create PO W/O any reference:
 Path to create PO:
 Go to T. code-ME21N.
 Select subcontracting document type or standard NB.
 Maintain subcontracting vendor code.
 Maintain purchase org. purchase group and company code.
----------------------------------------------Press Enter---------------------------------------------------
Go to item overview or expend item overview:
 Maintain item category- L.
 Maintain material code (final product).
 Maintain quantity, delivery date.
 Maintain price (subcontracting charges).
 Give plant and storage location→ press enter.
Subcontracting PR or PO error:
Error- Not possible to determine any components:
Solution:
This above error will trigger in all subcontracting PR’s or PO’s because if we miss to
maintain components list.
Go to material data tab in PR or PO then click on explode BOM if we maintain BOM then
from BOM components will copy otherwise click on components option then maintain
components list (material code), quantity and supplying plant→ Press enter→ Then go
back→ Click on check icon and save the subcontracting purchase order.
---------------------- subcontracting purchase order topic completed-------------------------

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 Goods issue to subcontractor (components)

Under this heading we will learn how to issue components to subcontractor with reference
to subcontract purchase order.
Path:
 Go to T. code- MB1B- Transfer posting.
 Maintain document date.
 Maintain posting date.
 Maintain movement type 541- Goods issue to SC.
 Give plant.
 Click on purchase order icon.
 Give subcontracting PO no. Press enter.
 System will display components list from PO.
 Click on adopt + details icon.
 Maintain storage location and goods issue batch number (we will get batch number
from MMBE T. code).
 Press enters save.
Note:
Once subcontracting goods issue to done then immediately system will add a line called
stock provide vendor in MMBE T. code along with quantity provided. This shows how
much our own stock lying in vendor (subcontracting) location.

-------------------- Goods issue to subcontractor (components) topic completed----------------

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 Create Delivery challan
Delivery challan is a supporting document use to send goods to outside of the company. In
SAP standard we don’t have DC printout.
We (SD consultant) will take the help of ABAP to design challan print out. Once challan is
created will take the print and will transport physically components to subcontractor.
 Go to T. code J1IGSUBCON (this t. code is introduced only in India after GST).
 Give company code, supplying plant.
 Maintain material document (transfer posting document).
 Activate create challan radio bottom.
 Execute.
 Activate material document check box.
 Click on create icon and system will generate challan number. (These challan number
configuration will done by consultant).
 We will take the challan print and will send physical goods to subcontractor.
 Once subcontractor receives the components then he will start converting those
components into final product and sends back to company. Once company receives final
product then they will do GR for final product and will inform about components
consumption to SAP system.

---------------------------- Create Delivery challan topic completed---------------------------------

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 Subcontracting goods receipt
 Go to T. code MIGO.
 Select event goods receipt.
 Select reference document purchase order.
 Give subcontracting PO no. enter.
 System will copy data from PO to GR screen.
 Give document date, and posting date – enter.
 Expend final product (click on + icon).
 Go to quantity tab and maintain final product receipt quantity.
Where tab:
 Movement type – 101.
 Maintain storage location.
 Maintain goods recipient name.
Batch number:
 In this system will generate batch number automatically when we will click on check
icon.
Activate item OK final product.
Components:
 Select components line.
 Go to quantity tab and maintain consumption receipt quantity.
Where tab:
 Movement type – 543.
Batch tab:
 In this tab we need to maintain goods issue batch number.
Activate item ok for components.
 Check and post the GR.
Note 1:
 We can check stock T. code MMBE.
Note 2:
Subcontracting accounting entry are:
 BSX – Inventory A/C – CR.

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  GBB – VBO – Stock consumption A/C – DR.
 BSV – Change A/C – CR.
 FRL – SC charges A/C- DR.
 BSX – Inventory (final product) A/C – DR.
 WRX – GR/IR clearing A/C – CR.

-------------------------- Subcontracting goods receipt topic completed---------------------

Subcontracting Post vendor invoice

 Go to T. code MIRO.
 Give company code enter.
 Give invoice date, and posting date.
 Then invoice number reference field enter.
 Go to PO reference tab.
 Give subcontracting PO enter.
 System will copy data from PO to invoice tab.
 Go to basic data tab.
 Select tax code activate calculate check box.
 Copy balance amount.
 Posting amount field.
 If balance amount become 0.
 Then simulate and save the invoice.

----------------------------------- Post vendor invoice topic completed-------------------------------

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 Subcontracting reconciliation
Under this heading end user will compare components issued (541 movement type) and
components consumed (543 movement type).
 Go to T. code J1IGRECON.
 Give material document number (GR number).
 Give year.
 Then activate processing FIFO.
 Execute and check the reconciliation report.
 This step we be performed only if we create delivery challan by using T. code
J1IGSUBCON.

--------------------------- Subcontracting reconciliation topic completed--------------------------

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 Goods receipt W/O PO
Sometimes clients will request goods to vendor over phone-based priority. In this case will
perform GR W/O PO after receiving physical stock from vendor.
 Go to T. code – MIGO.
 Select event goods receipt and reference document other – Enter.
 Give document date and posting date.
 Go to material tab and maintain material code – Enter.
 Go to quantity tab and maintain GR quantity.
 Go to where tab and maintain movement type – 501 plant and storage location.
 Go to partner tab and maintain vendor code.
 Go to batch tab and maintain date of manufacture, batch number will generate
automatically when we click on check icon.
 Activate item ok then check and post.
Note:
 Check stock in T. code – MMBE.
GR W/O PO accounting entries are:
 BSX – Inventory A/c – DR.
 GBB – Off setting entry A/c – CR.

----------------------------- Goods receipt W/O PO topic completed--------------------------------

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 Opening stock entry
Opening stock is also called as initial stock. Closing stock of non-SAP will be the opening
stock of SAP.
Path:
 Go to T. code – MIGO.
 Select event goods receipt and reference document other – Enter.
 Give document date and posting date. (Both can be same)
 Go to material tab and maintain material code – Enter.
 Go to quantity tab and maintain GR quantity, add stock value also in amount in LC
field.
 Go to where tab and maintain movement type – 561 plant and storage location.
 Go to partner tab and maintain vendor code.
 Go to batch tab and maintain date of manufacture, batch number will generate
automatically when we click on check icon.
 Activate item ok then check and post.
Note:
 Check stock in T. code – MMBE.
 Initial stock upload accounting entries are.
 BSX – Inventory A/c – DR.
 GBB – BSA-initial stock A/c – CR.

------------------------------- Opening stock entry topic completed------------------------------

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 3. Consignment process
In consignment process vendor keeps his own material in company’s location but
ownership remains same with vendor until the company uses (withdraw) it. Once company
uses the consignment stock then vendor will request for payment and company should
make payments.

Consignment process flow

Purchase Create
Goods Own stock
Maintain purchase Consignment
requisition receipt from
PIR order WRT settlement
(optional) WRT PO consignment
PO

End user steps involved in consignment process:

 Create PIR – ME11.
 Create Purchase order with item category K – ME21N.
 Goods receipt – MIGO.
 Stock withdraws from consignment stock – MB1B/MIGO.
 Consignment settlement (payment) – MRKO.

Create consignment PIR:

 Go to T. code – ME11.
 Give your vendor.
 Give your material.
 Maintain purchase order.

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  Maintain plant.
 Select info category - consignment – Enter.
 System will copy data from vendor in material master.
 If required edit that information.
 Maintain price, tax code (mandatory).
 Press enter and save it.
Note:
In consignment process price and taxes will copy from PIR screen to payment screen. But in
general prices will copy purchase order. Not in consignment.
Consignment PO:
 We can create PO WRT PR or without any reference.
 Go to t. code – ME21N.
 Select consignment document type or standard NB.
 Give vendor code.
 Give purchasing org., Purchasing group and company code.
--------------------------------------------Enter-------------------------------------------------
Expend item overview tab or go to item overview:
 Give item category K – consignment.
 Give material code, qty, delivery date.
 Maintain plant and storage location.
------------------------------------------Enter-------------------------------------------------
 Click on check icon and save the consignment PO.
Note:
In consignment PO net price field will be in disable mode because of item category K.
Condition tab and invoice tab will be in hide.
In consignment payment amount and taxes will copy from PIR instead of PO.
Create consignment goods receipt:
 Go to t. code- MIGO.
 Select event goods receipt and reference document PO.
 Give consignment PO- Enter.
 System copies from PO to GR screen.
 Give document date and posting date.
 Go to qty tab- Give receipt qty.

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  Where tab- movement type- 101- K.
 Then plant will copy from PO.
 Storage location will copy from PO.
 If we maintain or maintain here.
Batch:
 In this system will generate batch no automatically.
 When we click on maintain manufacture date. (If required)
 Activate item OK click on check icon and post it.
Note:
 Check in consignment stock MMBE t. code.
 No accounting entries consignment GR.
 Double click vendor consignment details.
Transfer consignment stock to company stock (own stock):
Under this heading we will learn how to transfer consignment stock to own stock.
 Go to t. code- MB1B.
 Give document date, posting date.
 Maintain header text (if required).
 Maintain movement type – 411 and special stock – K.
 Give plant and storage location- Enter.
 Maintain consignment vendor.
 Maintain consignment material code.
 Maintain transfer qty.
 Maintain consignment stock batch no (if will get batch MMBE t. code.
 Press enter and save it.
Consignment accounting entries:
In consignment process accounting entries will generate at the time of accepting the stock
ownership. (Movement type- 411 – K).
 BSX- inventory A/c – DR (+).
 KON – consignment payable – CR (-).
 Check stock in T. code- MMBE.
Consignment settlement:
In pipeline process and consignment process we will use T. code MRKO for invoice
payment and in general we will used MIRO for invoice payment.

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 When we are executing MRKO t. code for consignment and pipeline settlement system
will copy amount, tax code for PIR.
 Go to T. code- MRKO.
 Maintain company code.
 Maintain material document no- (411 no).
 Activate consignment check box.
 Activate settle radio bottom.
 Execute.
 Check document no.

---------------------------------------Consignment topic completed------------------------------------

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 4. Pipeline process
Pipeline is one of the special procurements in SAP MM. The material which are flowing thru
pipes, cables, wires, etc... are called pipeline materials. Ex. Electricity, water, gas, etc. if we
want to make material payments thru SAP system then we will use pipeline process.

Pipeline process flow

Maintain PIR Goods issue Pipeline settlement

End user steps involved in pipeline process:

 Create pipeline material by using material type PIPE – MM01.
 Create vendor or we can use existing vendor -XK01.
 Create PIR info category – PIPELINE – ME11.
 Record the consumption – MIGO.
 Pipeline settlement – MRKO.

1. Create pipeline material:

 Go to T. code – MM01.
 Select industry sector and material type pipeline material – PIPE.
 Select basic data, purchasing and accounting view.
 Press enters.
 Give your plant – Enter.
 Maintain material name and other field. In all the selecting view.
 Save the material.

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 2. create pipeline vendor (or) we can use any existing vendor.
3. create pipeline PIR.
 Go to T. code – ME11.
 Give vendor.
 Give pipeline material.
 Maintain PO, and maintain plant.
 Select pipeline info category – press enter.
 System will data copy from material and vendor.
 If required edit here.
 Maintain price and tax code which will copy to settlement screen.
 Press enter and save the info record.
4. record the consumption:
Under this heading we will record the pipeline material consumption (usage) quantity based on
bill received from vendor.
 Go to T. code – MIGO.
 Select event goods issue and reference document other.
 Give document date and posting date.
 Go to material tab – give pipeline material code - enter.
 Heading quantity tab – maintain consumed quantity as per bill.
 Where tab – maintain movement type – 201 [P] then give your plant – enter.
 Partner tab – maintain vendor code.
 Accounting assignment tab – maintain cost center.
 Activate item OK and check and post it.
5. pipeline settlement:
In pipeline process and consignment process we will use MRKO t. code for invoice
settlement. The amount and tax will be copied from PIR.
 Go to T. code – MRKO.
 Give company code.
 Maintain material document (goods issue document).
 Activate pipeline check box.
 Activate settle radio bottom and execute.

------------------------------Pipeline process topic completed------------------------------------

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 Controlling Module
Controlling is one of the modules available in SAP. It provides the information to
management or to decision maker to understand where company’s money is spent.
CO module integrates with other modules like MM, SD, PP
FI etc ...
Components of Controlling module:
 Cost center accounting
 Cost element accounting
 Profit centre
 Internal order
 Profitability
 Product cost controlling
 Activity based costing
The controlling module helps to schedule, monitor, execute and report on cost.
Co modules takes care of cost management.
1. Maintain Controlling Area
Controlling area is an organisational unit that represents a closed system used for cost
accounting purpose.
Controlling area will be assigned to multiple company codes to handle different currencies.
Path:
SPRO→ IMG→ Enterprises structure→ Definition→ Controlling→ Maintain controlling
area→ Enter→ Double clicks on maintain controlling area→ Click on new entries→ Click
on CO Area = C Code→ Give your company code→ Press enter→ Maintain assignment
control→ 1 Controlling area same as company code→ Save it.
Assign controlling area and company Code:
Path:
SPRO→ IMG→ Enterprises structure→ Assignment→ Controlling→ Assign company
code to controlling area→ Press enter→ Click on position→ Give your company code→
Select controlling area line→ Doble click on assignment of company code→ Click on new
entries→ Assign your company code (we can assign multiple company code) → Press
enter→ Save it.
------------------------------- Controlling Module topic completed---------------------------------

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 Cost center
Cost center is the exact location where the cost is occurred inside the company. The main
purpose of cost center is used to track expenses of the company. Each and every work will
be created as cost center in SAP.
EX: HR expenses, IT expenses, manufacture expenses, machinery expenses etc...
T. code: KS01.
Path:
SPRO→ IMG→ Enterprises structure→ Definition→ Controlling→ Create cost center→
Enter→ Double clicks on create cost center line→ Maintain your controlling area→
Enter→ Maintain cost center (10 CHAR) → Maintain valid date of cost center→ Enter→
Maintain cost center name, maintain person responsible, maintain cost center category 1,
maintain Hierarchy area H1, maintain currency→ Save it.
T. codes:
 KS01- Create cost center.
 KS02- Change cost center.
 KS03- Display cost center.
 KS04- Delete cost center.

---------------------------------------Cost center topic completed--------------------------------------

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 Goods issue (GI)
Goods issue will take place when materials are consumed to product finished goods or
goods issue will be done to customers, to other plants of same company or internal
department etc... when goods issue is done then system will decrease stock from SAP
books and from physical storage location also.
Goods issue to cost center:
Path:
 Go to T. code MIGO.
 Select event goods issue and reference document – other→ Enter.
 Give document date and posting date.
 Go to material tab and maintain material code – Enter.
 Go to quantity tab and maintain goods issue quantity.
 Go to where tab and maintain movement type – 201, plant and storage location.
 Go to batch tab and maintain goods issue batch number manually by copying from
MMBE t. code.
 Go to account assignment tab and give cost center.
 Activate item OK then click and post.
Note:
 Check stock in T. code – MMBE.
 Goods issue to cost center accounting entries are.
 BSX – Inventory A/c – CR.
 GBB – VBR – Off setting entry A/c + DR (consumption A/c).

------------------------------- Goods issue (GI) topic completed---------------------------------------

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 Reservation
Reservation in SAP will be used to block the material quantity for feature used.
Define reservation number range:
T. code:
OMC2 Path:
SPRO→ IMG→ Material management→ Inventory management and physically
inventory→ number assignment→ Define number assignment for reservation→ Enter→
Click on intervals→ Click on change intervals→ Insert line→ Give serial number→ Give
from and to number range (internals 10 CHAR) → Save it→ Go back 2 times→ Click on
no. range res/dep req→ Assign number range serial number→ Save it.
Client role:
T. code- MB21
Path:
SAP easy access screen→ SAP Menu→ Logistics→ Material management→ Inventory
management→ Reservation→ MB21- create→ Enter→ Reservation initial screen:
Maintain base date.
Maintain movement type:
 201- cost center.
 221- Project (PS)
 261- Order (PP)
 281- Network (PS)
 Maintain cost center for 201.
 Maintain WBS element for 211.
 Maintain order no. for 261.
 Maintain network for 281.
 Maintain plant→ Enter→ Give material code, maintain QTY, maintain batch→
Enter→ Save it.
T. code:
 MB21- Create reservation.
 MB22- Change reservation.
 MB23- Display reservation.

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  MB25- List of reservation.
Tables- SE16N:
 RESB- Reservation.
 We can check reservation stock in T. code MMBE along with MB25.
Goods issue against reservation:
 Go to T. code- MIGO.
 Select event goods issue and reference document – reservation→ Give reservation
no→ Enter.
 System will copy data from reservation to goods issue screen.
 Go to quantity tab and maintain goods issue quantity.
 Activate item OK then check the post.
Note:
 Check reservation stock in T. code MMBE and MB25.
 Goods issue against reservation accounting entries are.
 BSX – Inventory A/c – CR.
 GBB – VBR – Off setting entry A/c – DR (consumption A/c).

-----------------------------------Reservation topic completed-----------------------------------------

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