MM - User's Manual PDF

SAP MM USER MANUAL
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1. Master Data
Master data is the core data that is used as a base for any transaction. If you are producing,
transferring stock, selling, purchasing, doing physical inventory, whatever your activity may
be, it requires certain master data to be maintained.
Example of Master Data
• Material master data

• Vendor master data
1.1. Material Master Data
Creation of Material Master (MM01)
➢ Enter the material number to be created.

➢ Select the industry sector.
➢ Specify the material type for creation.
➢ Enter the reference material.
➢ Select the tabs for creation.
➢ Enter organization levels, specify the reference details also.
➢ Enter the material description.
➢ Check whether the tax code is correct.
➢ Plant specific material groups need to be filled for analytic purpose.
➢ Change the profit center according to the plant.
➢ Remove the moving average price is copied from the reference plant.
1.2 Vendor Master Data
Creation of Vendor Master Data (BP)
➢ Create an organization as a vendor
➢ Grouping used for categorizing the vendor (e.g. Domestic material vendor,
Service Vendor, Subcontracting Vendor etc.)
➢ Enter the basic details of the vendor like name, address, phone no etc.
➢ In Identification tab, GST No need to be filled.
➢ After filling the basic details go to company code tab.
➢ In Company Code tab, we have to assign company code with

vendor and also select which reconciliation account need to be
assigned with the vendor.
➢ Enter the required fields as marked.
➢ Now save the Finance Role and created a business partner number.
➢ Go to edit mode and select the purchase role.
➢ Click on the Purchasing tab
➢ Here vendor is assigned with purchase organization.
➢ If there is any partner function required mention it in partner function tab.
2. Procurement to Pay Cycle
2.1 Creation of Purchase Requisition
Start this transaction by typing t-code ME51N
Source Determination: We can fix a particular supplier for the procurement.
Material: Enter the materials to be procured.
Quantity: Mention the quantity to be procured.
Delivery Date: By default delivery date picked as current date, we need to change
that to the actual delivery date.
Plant: Select the plant from the list.
Valuation Price: Enter the unit price for the material.
Press the save button to post the document.
2.2 Create Purchase Order
Go to document overview select the purchase requisition and adopt it to purchase

order.
• Document date: Date of transaction occurred
• Vendor: If there is no fixed vendor adopted from PR, then select a vendor
from the list.
• Purchase Organization: Enter which organization responsible for the
purchase (e.g. Domestic/Import)
• Purchasing Group: Automatically fetched from material master.
• Company Code: Based on purchase organization company code will be

fetched.
• Tax: Tax code will be fetched from the last purchase/info record)
• Your Reference: It’s a text field for any internal reference.
• Vendor Invoice No: Text field for vendor invoice number.
• Unlimited: For unlimited delivery tolerance.
• Over Delivery Tolerance: Enter over delivery tolerance %.
• Under Delivery Tolerance: Enter under delivery tolerance %.
• Header Text & Item Text: Text field for header level details and item text
for item level details.
• Material PO Text: Text field maintained in material master for printing in
purchase order.
• Payment Terms: Automatically fetched payment term from vendor master
data.
• Incoterms: Incoterms also fetched from vendor master data.
• Incoterms Location: Location where already agreed with vendor for

delivery.
2.3 Goods Receipt (MIGO)
Start this transaction by typing t-code MIGO
Select Goods Receipt & Purchase Order, with reference to the purchase order number
we are doing goods receipt. Also check the movement type is 101.
• Document Date: Enter the invoice date.
• Posting Date: Enter the date of posting in SAP.
• Delivery Note: Put Invoice number as delivery note.
• Header Text: Maintain any generic information about the GRN.
• Quantity: Verify the quantity received physically. If there is any quantity
deference mentioned the received quantity.
• Quantity in Delivery Note: Enter the actual quantity received.
• Batch: Batch number will be auto generated or it can be manually entered.
• Date of Manufacturing: If the material having expiry we have to input date of

manufacturing.
• SLED/BBD: Expiry date automatically calculated based on the shelf life and date
of manufacturing date.
• Valuation Type: Check whether the valuation type is same as of batch.
• Item OK: After verify the details put tick mark on this field.
2.4 Invoice Verification (MIR7)
Start this transaction by typing t-code MIR7
• Invoice Date: Enter the invoice date.
• Posting Date: Enter the date of posting in SAP.
• Reference: Text field for reference.
We have to post invoice against delivery note. So, select delivery note and input the
delivery note number.
Check the amount, quantity & tax value adopted with reference to the delivery note.
• Calculate Tax: Tick the check box for calculating tax.
• Business Place: Enter business place.
• Section Code: Enter section Code.
• Balance: This fields always be zero while posting the invoice. Amount in the
balance should be copied to the amount field.
If there are any additional freight charges or packing charges is there we can enter it
against particular GL accounts.
• Unplanned Delivery Cost: If any additional charge without tax.
• Amount: Check with the invoice amount, if its matched then we can post the
document.
• Simulate: After completing all entries click on simulate button and check the GL
entries are correctly posted.
Press the save parked document button to post the document.
3. Consumption Based Reservation
3.1 Creation of Reservation
Start this transaction by typing t-code MB21
For consumption-based reservation we are using movement type 201.
Enter material, quantity, storage location and batch details also mention under which
cost center need to books the consumption entry.
3.2 Goods Issue against of Reservation
4. Location Wise Reservation
4.1 Creation of Reservation
Start this transaction by typing t-code MB21
4.2 Reservation against Transfer Posting
5. Normal Service Procurement
5.1 Create Service Purchase Requisition

➢ Put K in account assignment group.
➢ Remove Goods Receipt tick.
Press the save button.
5.2 Create Service Purchase Order
Press the save button.
5.3 Invoice Verification against Service Purchase
Start this transaction by typing t-code MIR7
Invoice against service purchase order.
Click on Simulate Button.
6. Service Procurement – Value Limits
6.1 Creation of Service Purchase Order
Raising AMC Order with Value Limits

➢ Select Account Assignment – K (Cost center)
➢ Select Item Category – B (Limit)
➢ Click the Limits tab and enter the overall limit value.
The total of all procurements for this purchase order during the validity period cannot
exceed this value.
➢ Click the Account Assignment tab. Based on the account assignment
indicator K specified in the item section, specify the cost center and G/L account
that all invoices should post to.
➢ Goods Receipt is not applicable due to the item category.
6.2 Invoice Verification
Start this transaction by typing t-code MIRO
➢ The purchase order limit was set to 220,000.00 INR. An attempt to create an
additional invoice that exceeds the limit will result in the above error message.
7. Subcontracting Process
7.1 Creation of Subcontracting Purchase Order (ME21N)
➢ Parent Material – CNDSTSQ19MC
➢ Component – CNDSTCL04CV
Maintain Item Category with L, Components should be maintained in the Item Detail → Material Data →
Components Icon
Purchase Order Created - 4500000632
7.2 Transfer Posting of Components (MIGO)
Select Transfer Posting against Purchase Order, and movement type 541 as highlighted on the
screenshot below.
Stock will be placed separately from the un-restricted use of stock.
7.3 Goods Receipt against PO (MIGO)
The subcontractor returned the materials after performing the work you need to enter the received finished
material. Movement Type – 101
To view the components consumed click the EXPAND Icon.
Parent Material added to the stock and Component consumed, overview in the MMBE Stock.
Parent Material - CNDSTSQ19MC Component Material - CNDSTCL04CV
7.4 Invoice Verification
Invoice Verification against Delivery Note.

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SAP MM USER MANUAL

Example of Master Data

• Material master data

1.1. Material Master Data

Creation of Material Master (MM01)

➢ Enter the material number to be created.

➢ Enter the material description.

Creation of Vendor Master Data (BP)

➢ Create an organization as a vendor

➢ In Company Code tab, we have to assign company code with

➢ Click on the Purchasing tab

2.1 Creation of Purchase Requisition

Start this transaction by typing t-code ME51N

Source Determination: We can fix a particular supplier for the procurement.

Material: Enter the materials to be procured.

Quantity: Mention the quantity to be procured.

Plant: Select the plant from the list.

Valuation Price: Enter the unit price for the material.

2.2 Create Purchase Order

Start this transaction by typing t-code ME21N

Go to document overview select the purchase requisition and adopt it to purchase

• Document date: Date of transaction occurred

• Company Code: Based on purchase organization company code will be

• Your Reference: It’s a text field for any internal reference.

• Vendor Invoice No: Text field for vendor invoice number.

• Over Delivery Tolerance: Enter over delivery tolerance %.

• Under Delivery Tolerance: Enter under delivery tolerance %.

• Incoterms: Incoterms also fetched from vendor master data.

• Incoterms Location: Location where already agreed with vendor for

Press the save button to post the document.

Start this transaction by typing t-code MIGO

• Document Date: Enter the invoice date.

• Posting Date: Enter the date of posting in SAP.

• Delivery Note: Put Invoice number as delivery note.

• Header Text: Maintain any generic information about the GRN.

• Quantity in Delivery Note: Enter the actual quantity received.

• Date of Manufacturing: If the material having expiry we have to input date of

• Valuation Type: Check whether the valuation type is same as of batch.

Press the save button to post the document.

Start this transaction by typing t-code MIR7

• Invoice Date: Enter the invoice date.

• Posting Date: Enter the date of posting in SAP.

• Reference: Text field for reference.

• Business Place: Enter business place.

• Section Code: Enter section Code.

• Unplanned Delivery Cost: If any additional charge without tax.

3.1 Creation of Reservation

Start this transaction by typing t-code MB21

For consumption-based reservation we are using movement type 201.

Start this transaction by typing t-code MIGO

Press the save button to post the document.

4.1 Creation of Reservation

Start this transaction by typing t-code MB21

Start this transaction by typing t-code MIGO

Press the save button to post the document.

5.1 Create Service Purchase Requisition

➢ Put K in account assignment group.

➢ Remove Goods Receipt tick.

Press the save button.

Start this transaction by typing t-code ME21N

Start this transaction by typing t-code MIR7

Invoice against service purchase order.

Click on Simulate Button.