What is Item Category and Account Assignment Category in SAP MM & Its Types with Description.

 

 ITEM CATEGORY

ITEMS category is show that which type of procurement is done in this purchase order.

Generally , Items Categories are the following types.

1. STANDARD

Items of the category Standard are goods that are to be procured externally. In this case, both goods and invoice receipts are possible.

Characteristics Goods and invoices can be received

                                 

  

2. LIMIT (B)

Limit items occur in connection with blanket purchase orders (which hence may also be referred to as "P o s with limits or "limit orders"). Blanket P o s can be used to procure a variety of materials or services up to a certain predefined maximum value (the value limit) from a vendor. The nature of the materials or services in question is generally such that the cost of and administrative effort involved in processing individual purchase orders is regarded as disproportionately high in relation to their value (e.g. purchase of office supplies and minor services required during the course of the year).

Blanket PO have the document type FO. Instead of a specific delivery date, you can specify a validity period for the order.

Goods receipts or the entry and acceptance of services performed are not necessary in the case of a blanket PO and limit items. The invoices are posted directly with reference to the purchase order, provided that the specified value limit is not exceeded. The account assignment need only be specified at the time of invoice entry.

Characteristics Account assignment not necessary GR not necessary IR necessary Document type FO necessary

3. CONSIGNMENT (K)

Items of the category Consignment are items procured on a consignment basis. Account assignments cannot be made for material ordered on consignment. Consignment stocks are managed separately and are not valuated.

Consignment stocks are discussed in the consignment section of the MM Inventory Management documentation.

Characteristics Material number necessary No account assignments Material kept in stock GR necessary Invoice receipt not necessary

4. SUBCONTRACTING (L)

Order items of the category Subcontracting may represent finished assemblies ordered from a subcontractor, for example. Any components the subcontractor requires from you to produce such an assembly are entered as "material to be provided items.

Subcontracting is discussed in the Subcontracting section of the MM Inventory Management documentation.

Characteristics Goods can be received Invoice receipt necessary

5. THIRD-PARTY (S)

Third-party orders are orders placed with vendors as part of a triangular business deal, instructing the latter to supply goods to or perform a service for a third party (for example, a drop-shipment to one of your customers). This means that the goods recipient is in this case the customer. "Third-party can be specified in the item category field of a requisition or purchase order.

The third-party order is one of the special order types in Purchasing, and is discussed in the section  Third-Party Processing of the MM Inventory Management documentation.

Characteristics Account assignment necessary GR and IR can take place

6. STOCK TRANSFER (U)

Stock transfer items occur in connection with stock transport ordering. Stock transport orders are a mechanism for the transfer of stock from one plant to another (that is, transfers involving transport over a longer distance).

The stock transport order is one of the special order types in Purchasing, and is discussed in the section Stock Transfer Using a Stock Transport Order of the MM Inventory Management documentation.

Characteristics Material number necessary GR necessary No invoice receipt

7. SERVICE (D)

Planned services or services whose nature and scope is defined at the time of procurement (Item category D)

In service, a third party provides services to a company. These services include maintenance functions such as electricity and oiling of machines. Follow the steps given below to create a service purchase order.

 ACCOUNT ASSIGNMENT CATEGORY

ACCOUNT ASSIGNMENT category shows that which account will be charged for this PO after a good receipt.

It indicates what type of purchase the company is doing in Purchasing Documents, whether it is for consumption or anything relation to orders, projects etc. The nature of this also indicates which accounts it needs to be charged for when the incoming invoice and Goods Receipt are posted.

Generally, Account assignment categories are the following types.

Description	Required account assignment data
Asset (A)	Main asset number and sub-number
Order	Order and G/L account number
Production order	Production order number
Business process	Business process and G/L account number
Cost center  (K)	Cost center and G/L account number
Sales order  (C)	Sales order and G/L account number
Individual customer requirement	Sales order and G/L account number
Project  (P)	Project and G/L account number
Unknown  (U)	None

 

Create a Purchase Order (PO) in Sap MM ME21N - Basic Information about PO with Images | Purchase Order Creation | What is Purchase order in sap mm | ME21N t_code

  PURCHASE ORDER (PO) is an external document that is submitted to the vendor where the vendor is liable to provide the material as per the mention of the term in these documents.

PURCHASE ORDER structures are determined by these factors.

1. PURCHASE ORDER DOCUMENT TYPES

PURCHASE ORDER DOCUMENTS TYPES is responsible to control the header level content and differentiate the business transaction for controlling the posting to different accounts(vendor, customer or G/L account). Different number range is assigned to different document types..

2. ITEM CATEGORY

ITEMS category is show that which type of procurement is done in this purchase order.

Generally , Items Categories are the following types.

1. STANDARD

Items of the category Standard are goods that are to be procured externally. In this case, both goods and invoice receipts are possible.

Characteristics Goods and invoices can be received

                                 

  

2. LIMIT (B)

Limit items occur in connection with blanket purchase orders (which hence may also be referred to as "P o s with limits or "limit orders"). Blanket P o s can be used to procure a variety of materials or services up to a certain predefined maximum value (the value limit) from a vendor. The nature of the materials or services in question is generally such that the cost of and administrative effort involved in processing individual purchase orders is regarded as disproportionately high in relation to their value (e.g. purchase of office supplies and minor services required during the course of the year).

Blanket PO have the document type FO. Instead of a specific delivery date, you can specify a validity period for the order.

Goods receipts or the entry and acceptance of services performed are not necessary in the case of a blanket PO and limit items. The invoices are posted directly with reference to the purchase order, provided that the specified value limit is not exceeded. The account assignment need only be specified at the time of invoice entry.

Characteristics Account assignment not necessary GR not necessary IR necessary Document type FO necessary

3. CONSIGNMENT (K)

Items of the category Consignment are items procured on a consignment basis. Account assignments cannot be made for material ordered on consignment. Consignment stocks are managed separately and are not valuated.

Consignment stocks are discussed in the consignment section of the MM Inventory Management documentation.

Characteristics Material number necessary No account assignments Material kept in stock GR necessary Invoice receipt not necessary

4. SUBCONTRACTING (L)

Order items of the category Subcontracting may represent finished assemblies ordered from a subcontractor, for example. Any components the subcontractor requires from you to produce such an assembly are entered as "material to be provided items.

Subcontracting is discussed in the Subcontracting section of the MM Inventory Management documentation.

Characteristics Goods can be received Invoice receipt necessary

5. THIRD-PARTY (S)

Third-party orders are orders placed with vendors as part of a triangular business deal, instructing the latter to supply goods to or perform a service for a third party (for example, a drop-shipment to one of your customers). This means that the goods recipient is in this case the customer. "Third-party can be specified in the item category field of a requisition or purchase order.

The third-party order is one of the special order types in Purchasing, and is discussed in the section  Third-Party Processing of the MM Inventory Management documentation.

Characteristics Account assignment necessary GR and IR can take place

6. STOCK TRANSFER (U)

Stock transfer items occur in connection with stock transport ordering. Stock transport orders are a mechanism for the transfer of stock from one plant to another (that is, transfers involving transport over a longer distance).

The stock transport order is one of the special order types in Purchasing, and is discussed in the section Stock Transfer Using a Stock Transport Order of the MM Inventory Management documentation.

Characteristics Material number necessary GR necessary No invoice receipt

7. SERVICE (D)

Planned services or services whose nature and scope is defined at the time of procurement (Item category D)

In service, a third party provides services to a company. These services include maintenance functions such as electricity and oiling of machines. Follow the steps given below to create a service purchase order.

3. ACCOUNT ASSIGNMENT CATEGORY

ACCOUNT ASSIGNMENT category shows that which account will be charged for this PO after a good receipt.

It indicates what type of purchase the company is doing in Purchasing Documents, whether it is for consumption or anything relation to orders, projects etc. The nature of this also indicates which accounts it needs to be charged for when the incoming invoice and Goods Receipt are posted.

Generally, Account assignment categories are the following types.

Description	Required account assignment data
Asset (A)	Main asset number and sub-number
Order	Order and G/L account number
Production order	Production order number
Business process	Business process and G/L account number
Cost center  (K)	Cost center and G/L account number
Sales order  (C)	Sales order and G/L account number
Individual customer requirement	Sales order and G/L account number
Project  (P)	Project and G/L account number
Unknown  (U)	None

 Lets create a Purchase Order.

SPRO ⇒ IMG ⇒ Materials Management ⇒ Purchasing ⇒ Purchase Order ⇒ 1) Define Number Ranges.

                                       

SPRO ⇒ IMG ⇒ Materials Management ⇒ Purchasing ⇒ Purchase Order ⇒ 2) Define Document Types.

 👇Enter  T_CODE  ⇒  ME21N

Fill in all the necessary details such as name of the vendor, purchasing organization, purchasing group, company code, and details of the material, for example, material number, price, currency, and plant.

 👇

Purchase Order Created👆

Create Purchase Requisition (PR) in SAP MM ME51N | Introduction OF Purchase Requisition in SAP MM | SAP Purchase Requisition Tutorial

 PURCHASE REQUISITION (PR) is the first step of the procurement cycle. In this step, we gather information about the material, quantity, value, delivery date, etc.

We can define PURCHASE REQUISITION as an internal document that is requested by the purchase organization to procure the given list of items/material.

ME51N is the T_CODE to generate the purchase request.

Following the type of procurement is done by Purchase requisition.

1. STANDARD

To get finished material from a vendor.

2. CONSIGNMENT

 To get material from vendor and put in own premises with vendor responsibility. Pay to the vendor only after used from these premises lying material.

3.SUB-CONTRACTING 

To provide raw material to vendor and get a finished good material from the vendor.

4.STOCK TRANSFER ORDER

To transfer the material within  organization.

5.EXTERNAL SERVICES

To get maintenance ⛑ type services from a third party.

Lets create a Purchase Requisition.

SPRO ⇒ IMG ⇒ Materials Management ⇒ Purchasing ⇒ Purchasing Requisition ⇒1) Define Number Ranges.

SPRO ⇒ IMG ⇒ Materials Management ⇒ Purchasing ⇒ Purchasing Requisition ⇒2) Define Document Type.

  

 👇Enter  T_CODE  ⇒  ME51N

Fill in all the required details such as name of the material, quantity, delivery date, material group, and plant. Click on Save. 

👇

👆

A new Purchase Requisition will be created.