Chapter 5 All Answers 100% Correct Fall-2021 Solution Aid Grade A+
Basic Procurement Process Procurement process is also known as requisition-to-pay process Organizational Data Organizational levels relevant to the procurement process include: ● Client (represents an enterprise that is comprised of many companies or subsidiaries, each of which is represented by a company code) ● Company code (CC) (most activities in the procurement process occur within a company code) ● Plant (location where the materials are received – receiving plant or location where goods are produced – manufacturing plant) 3 additional organizational data are relevant to purchasing: Plant ● Many definitions or uses. A location ● That holds valuated stock (for distribution) ● Where production planning is carried out ● Where products and services are created ● That contains service or maintenance facilities ● Factory, warehouse, distribution center ● Can be assigned to one CC only ● A CC can have many plants Storage Location ● A place, within a plant, where materials are stored until needed ● Areas designated for different types of material (raw material, work-in-process, finished goods) ● More sophisticated divisions including storage bins, cabinets, trays ● A plant can have multiple storage locations, each of which is designated for different purposes or stores specific types of materials ● A storage location can belong to only one plant ● Locations range from small bins to entire buildings, depending on the size of the materials being stored ● A plant must have at least one storage location if it needs to track the quantity and value of materials in its inventory (ex. A plant that serves as a production or storage facility must maintain accurate records of the quantity and value of raw materials, semifinished goods
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