Top SAP MM Interview Questions (2024)

SAP MM Interview Questions For Experienced

21. What is the difference between production orders and purchase orders?

Production order: It determines which materials must be prepared at what time and location and the quantity required. It also specifies the components and sequence of operations that must be used. Furthermore, concerns about order costs must be addressed.

Purchase order: A purchase order is issued by a vendor or factory to supply a specific quantity of products and services at a specific time and location.

22. How does SAP MM utilize its main master files?

SAP MM (Materials Management) uses its main master files to manage materials efficiently. These files contain essential data like item descriptions, suppliers, and prices. By accessing this information, SAP MM streamlines procurement, inventory management, and pricing processes, ensuring businesses can handle materials effectively and economically.

23. What is the Master production schedule (MSP)?

MSP is used to plan for individual commodities that must be produced at all times, such as production, inventory, staffing, and so on. It is related to manufacturing, where the plan specifies how much and when each product will be required.

24. Could you please explain the process of linking a document to a vendor master record?

Linking a document to a vendor master record involves associating specific documents (e.g., invoices, contracts) with a vendor's information in a business or accounting system. 
First, access the vendor's profile, then choose and upload the document. Provide document details such as type and date, and save the attachment. Now, the document is linked to the vendor's master record, enabling easy retrieval when needed. This organized approach streamlines record-keeping, enhances data accessibility, and simplifies vendor transaction reviews. It's crucial to ensure secure access and periodically manage linked documents for efficient vendor management and compliance.

25. What is the difference between stock procurement and consumption procurement?

Procurement for Stock: This refers to the storage of material on hand. Once received from the seller, the material is stored in it. The quantity of stock material depends on the material's demand. We keep the master record in the system to record all information about the stock.

Procurement for Direct Consumption: When a material is stored and then used or consumed, this is referred to as procurement for direct consumption. A master record is kept within the system before ordering material for consumption.

26. What is invoice processing?

A company's account payable department uses it to manage supplier invoices. Invoice processing begins when an invoice is accepted and ends when it is cleared and is recorded in the general ledger.

27. What is a purchase requisition?

It is a primary document used to launch a product or purchase supplies. It is a component of the accounting method. This document provides the buyer with information about the purchases and identifies the business requirements.

28. What is the difference between a goods receipt and a post goods receipt?

Goods receipt occurs when the physical inbound transfer of material and goods into the warehouse occurs. It includes the transfer of goods received from in-plant production or external vendors. The issuance of goods receipts always increases warehouse stock.

A post-goods receipt is when the receipt of goods is posted concerning the purchase order with which products or goods were ordered. When the material for a purchase order is sent, all departments must enter the system references.

29. What is SAP Material Master? How can it be kept in the SAP system?

A material master has information on various materials, such as raw materials and finished products. It is used for product identification, goods issue, receipt, purchase material, production confirmation, and MRP.

Material data is stored in a single database object to avoid redundancy. The material should be created only once in the system and given a unique number.

Depending on the views maintained, a material receives an automatic maintenance status. When you want to use a material in a process, the system checks to see if it has the required maintenance status—that is, if the required views have been maintained.

30. How does a company's Posting Period work?

A company's posting period is used to define five fields, including;

1. Keep the Fiscal Year Variant
2. Define Open Posting Period Variants
3. Posting Periods (Open and Closed)
4. Assign the Variant to the Company Code
5. Assign the Fiscal Year Variant to the Company Code

31. What is a contract in SAP MM?

A contract in SAP MM is a long-term agreement between the seller and the ordering party for predefined material for a specific framework. Contracts are classified into two types.

Quantity Contract: The entire value of a quality contract is stated in terms of the quantity required to be supplied by the seller.

A value contract specifies the total amount that the vendor must pay. When the company supplies the agreed total value of material against the contract, the contract is considered fulfilled.

32. What is the purpose of the batch record?

A batch is used to determine the quality of a specific product that must be processed or produced simultaneously. It should be noted that the material produced in such a batch must have the same characteristics and values. Furthermore, the batch record ensures that information about a specific batch product is available. It also helps in determining whether or not the product has gone through the Good Manufacturing Process (GMP).

33. What is the distinction between the terms RFQ, RFI, and RFP in SAP MM?

34. What do you mean by "Outline agreement"?

An outline agreement is a long-term purchase agreement. It is made with the seller with terms and conditions about the goods or material that the seller is required to send. This agreement is only valid for a limited time and covers a predefined quantity or value.

35. How can you identify the crucial fields within the purchasing view in SAP MM?

To spot important details in SAP MM's purchasing view:

• Look for item descriptions.
   
• Check quantities.
   
• Review prices.
   
• Verify supplier info.
   
• Inspect delivery dates.

36. In SAP MM, how is a purchase requisition created and released?

A purchase requisition is created using T-code ME51N as part of this process:

• First, the ME51N transaction is executed.
• Then, create a purchase requisition document of the following type: NB.
• Now choose the source: OFF or ON.
• Enter the heater note, material number, UoM, quantity, and storage location.
• The vendor is then determined automatically through source determination.
• Now enter the tracking number and valuation prices before saving the transaction data.

37. How can you provide a detailed explanation of the various steps involved in the Procurement Lifecycle?

Here's a simplified explanation of the Procurement Lifecycle:

• Planning: First, plan what to buy and set a budget.
   
• Sourcing: Then, you find suppliers who can provide what you need.
   
• Selecting: You choose the best supplier based on cost and quality.
   
• Ordering: Next, you place an order with the chosen supplier.
   
• Receiving: When the goods arrive, you confirm they're what you ordered.
   
• Paying: Finally, you pay the supplier for the delivered goods or services.

38. What is RTP?

RTP stands for returnable transport packaging. It is a multi-trip packaging medium in which goods or products are transported between customers and retailers more than once.

39. What steps are involved in the RFQ process?

To process an RFQ, several steps are taken:

• Enter the t-code (transaction code) ME41 first, followed by the RFQ type 'AN.'
• After that, make a note of the location and the late date when the seller submits the quotation. Enter the purchasing group, delivery date, and other details, and click the button.
• Following that, you will see a new screen where you must enter the item codes. Now enter the item codes as well as the vendor's information.
• Furthermore, additional requests can be made based on vendor information.

Frequently Asked Questions

What are the important topics in SAP MM module?

SAP MM is composed of five primary components. These functions include materials management, plant maintenance, quality management, production planning and control, and a project management system. Each has a number of sub-components. SAP MM (Material management) is all about managing an organization's materials or resources.

What is the pricing procedure in SAP MM interview questions?

The Pricing procedure in the MM module is a mechanism for determining prices in purchase papers. This allows us to assign different calculation types for different uses. The total material value is based on all additions and subtractions, such as surcharges, discounts, taxes, and goods.

What are the benefits of using SAP material management?

• Inventory with multiple locations
• Stock replenishment
• Management of the Product Life Cycle
• Material valuing
• The serial and lot traceability
• Bin administration
• Scheduling and resource allocation

Is SAP MM still in demand?

Yes, SAP MM (Materials Management) is still needed by many companies. It manages and controls the procurement and inventory of materials, which remains vital in business operations.

In SAP MM, what is the process order?

Process orders are created when thorough planning and execution of process manufacturing are determined. It identifies the material production in a production run.

Conclusion

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