End of Chapter 5 Questions (Chapter 5 - The Fulfillment Process)

Describe and discuss the accounting entries that occur at each step of the fulfillment process.

- Inventory account-system posts a credit to individual account -COGS account-goods issue posted in debit - revenue account-can be generated from other processes, can include a controlling impact, can be differentiated - customer subledger-customer invoice and payment posted here - Accounts receivable account-posted from customer subledger to credit and debit - bank account-posted in debit

Explain access sequences in pricing procedures, and provide an example of how the ERP system determines pricing.

- It involves numerous condition types, condition records, and condition tables, as well as access sequences and pricing procedures. provides a flowchart that illustrates the various steps that the ERP system must complete to determine the price - the access sequences prioritizes a more specific condition record over a general pricing conditions. For example, if the available conditions records for discounts are material discounts, flat rate discount, and a customer specific discount, then the aces sequence will give the customer specific discount the highest priority to be included int he sales order.

Describe the steps in the fulfillment process.

- customer inquiry-a request for product/service information without any customer obligation to purchase anything - sales quote-legally binding offer by the company to deliver certain products/ services - Sales order-contains data from P.O. - shipping-prepare and send materials to customers - invoice-requests customer for payment - payment-payment-received from customer

List and describe the three types of pricing conditions in an ERP system.

- materials discount, flat rate discounts, and customer specific discounts -> condition record for discounts

List and define four of the organizational structure elements required for fulfillment.

- sales org-used to serrate their market based on geography - DC-defines the path by which on org gets its products/services to its customers - Distribution chain-combination of a sales org and a DC that reflects how a sales org distributes its product/services - division-used to group together products with similar characteristics

List and define the two material types that are most relevant to fulfillment.

- trading goods-are always procured externally and sold again without being processed further. A material master record of this material type can contain purchasing data and sales data, and is managed on both a quantity and a value basis. - finished goods-are goods that have completed the manufacturing process, but have not yet been sold.

Explain the relationship of condition types to pricing procedures.

A pricing procedure identifies the various condition types that potentially can be included in calculating the net price. It also specifies the sequence in which the condition types are to be evaluated.

Why would an organization configure customer account groups in the ERP system?

Customer account groups define categories of casters who possess similar characteristics. Account groups determine the status of the fields displayed in the customer master.

Explain which automatic account assignment processes must be configured to execute accounting entries.

Customer subledger is obtained from the sales order and the A/R reconciliation front the customer master record. the bank account is provided by the user when the customer payment is recorded in the system. for the other three accounts (inventory, COGS, and revenue), specific account determination rules must be configured in the system

What role do customer account groups play in the fulfillment process?

The customer account group define categories of customers who possess similar characteristics. Account groups determine the status of the fields displayed in the customer master.

Define availability check as it relates to fulfillment.

availability check is a technique that the system uses to determine material availability in many processes such as fulfillment and production. when sales order is created, the system complete an availability check to determine whether there needed materials will be available in time to meet the customers desired delivery date

What is the role of a customer information record?

contains data that are specific to one customer and one material.

What is a distribution chain, and why is it important?

is a combination of a sales organization and a distribution channel that reflects how a sales organization distributes its products and services.

Describe the purpose of a sales area, and explain how it is assigned.

is a combination of one sales organization, one distribution channel, and one division. Because a sales organization has to be uniquely assigned to a company code, it follows that a sales area can belong to only one company code. All sales documents, such as sales orders, are associated to a single sales area.

What is the fulfillment process?

is a critical business process for organizations that sell products or services to their customers.

What is the role of a shipping point in fulfillment?

is a physical location within a delivering plant from which outbound deliveries are sent out. Each outbound delivery can be shipped from only one shipping point in the delivering plant.

What are the different roles a business partner can be assigned in the ERP system?

sold to plenty, bill to party, payer, ship to party

What are loading groups used for?

specifies the method that is used for loading or handling a material.