SAP MM Interview Questions and Answers by B G Basetty & Rajendra G

THIRD PARTY PROCESSING

1. For third party PO which are all mandatory fields?

A: The followings are the mandatory fields in a third party PO:

 Item category “S”
 Account assignment category “X”
 Customer number or Delivery address

2. What are the Movement types involved in Third Party? How many
accounting documents are generated?

A: Movement type involved in Third Party is 101. Only one accounting document is
generated.

3. For third party what is the impact on GR?

A: Impact of GR for third party:

 Stock updating will not take place as the goods receipt is posted to
consumption.
 The value of the PO is posted to GR/IR clearing account for the purposes
of invoice verification
 PO history is updated.

4. Explain Third Party processing scenario? How do you create a Third Party
order in SAP?

A: In third party processing you place a purchase order with a vendor to deliver
goods or perform service for a third party (for example, for a customer). This
means that your company does not deliver the material. You forward the order to
an external vendor instead, who then sends the material directly to your customer
and invoices you.
Third party order can be created in SAP through SD & MM module. That is
through:
 Sales order
 Purchase requisition
 Purchase order
A third party order is usually created referencing a third party item in purchase
requisition. If you do not use SD module and you have not entered a purchase
requisition you can also create a third party order manually as follows:
 Enter a third party item with item category “S” & account category “X”

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SAP MM Interview Questions and Answers by B G Basetty & Rajendra G

 After entering the account assignment category as “X” you receives a

dialog box in which you enter the address of the Sold – to – party.
 Enter either the customer number or delivery address
 Check whether a GR can be made for the third party item. GR for the third
party item is possible if the GR indicator is set in the item.
 Save the PO.

5. What is third party purchase order process? Can you elaborate on the
complete process within MM?

A: Refer answer of Q.No- 4

6. When using purchase orders for third party processing can a single purchase
order have multiple ship – to address? Why or why not?

A: Yes each line can have its own delivery address.

7. When using sale orders for third party processing what internal document is
directly tied to the sales order?

A: The purchase requisition.

8. When a third party sales order is created a purchase order is created

automatically when the sales order is saved. Is it true or false?

A: False. A purchase requisition is created when you save the sales order for third
party processing is saved. This purchase requisition is then converted into
purchase order.

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