Inventory

Part-1
1. What are different planning methods in Inventory
There are 5 different planning methods in oracle Inventory

 Subinv Replenishment Planning

 Min Max Planning
 Re-order point planning
 Kanban Planning
 Periodic Automatic Replenishment

2. What are the setups for different planning method (Min-Max)

Setup the item in master org and assign the item to the org for which Min-Max planning is used
 Attributes, Inv Planning method: Min-Max
 Min-Max Qty should have been defined
 Safety Stock method should be non MRP Planned
 Determine what should be the status of the Requisitions created for the planning
 Do this with profile option INV: Minmax Reorder Approval
 IF Use ASL has been enabled, then Requisition will populate the supplier data from the ASL
setup which is assigned to the item
 Sourcing rules can be defined for this
 Then need to assign sourcing rule to the item
 In Inventory responsibility, under Planning run the Min Max planning report with required
parameter
3. What is the concurrent program for the planning
Min Max planning report under planning menu in Inventory responsibility

4. What are the setups for expense item?

 Should not be Inventory Item

 No Stockable
 No Transactable
 No Costing, Inv Asset
5. How many key flexfields are there in Inventory?
Seven KFF are there in Inventory

 Account Alias
 Item
 Item Category
 Item Catalogues
 Stock Locators
 Sales Order
 Service Items
6. What is the use of sales order KFF?

 This is used during material transaction when source is Sales Order

 Segments are Sales order Number.Sales Order Type.Sales Order Source
 7. How we can have the item key flexfield with 2 segments, is it possible, if yes then
how, if no then why?

 This can be modified using Flexfield>Key> Segments

 Query the System Items, then you can modify the existing structure, or you can add a new
one.
8. How will you inactivate the Inventory locations
By giving Inactive date in the Location form

9. What all setups you have done in inventory organization implementation

 Location
 Calendar
 Organization
 Parameter
 Cost Group
 Subinventory
 Stock Locator
 Receiving Options
 Shipping Networks
 Intercompany Transaction flows
 Cost Subelements

10. What is the difference between purchased and purchasable flag for an item?

 Purchasable is a status attribute flag, so based on this flag, certain transactions can be
controlled for an item.
 Purchased flag decides whether to purchase and receive this item.
 Purchasable flag decides, whether to order this item in a purchase order.
 If purchasable is enabled, item can be ordered in a purchase order, if not, new purchase
orders cant be created and approved for the items.
 If purchased is enabled, item can be received if already present in an approved purchase
order.

Part - 2

1. What are the valuation accounts used in Inventory

 Material An asset account that tracks material cost. For average costing, this
account holds your inventory and intransit values. Once you perform transactions, you
cannot change this account.
 Material Overhead An asset account that tracks material overhead cost.
 Resource An asset account that tracks resource cost.
 Overhead An asset account that tracks resource and outside processing overheads.
 Outside processing An asset account that tracks outside processing cost.
 Expense The expense account used when tracking a non-asset item
Other Accounts
 Sales The profit and loss (income statement) account that tracks the default
revenue account.
 Cost of Goods Sold The profit and loss (income statement) account that tracks the
default cost of goods sold account.
 Purchase Price Variance The variance account used to record differences between
purchase order price and standard cost. This account is not used with the average cost
method.
 Inventory A/P Accrual The liability account that represents all inventory purchase
order receipts not matched in Accounts Payable, such as the uninvoiced receipts account.
 Invoice Price Variance The variance account used to record differences between
purchase order price and invoice price. This account is used by Accounts Payable to record
invoice price variance.
 Encumbrance An expense account used to recognize the reservation of funds
when a purchase order is approved.
 Average Cost Variance Under average costing with negative quantity balances,
this account represents the inventory valuation error caused by issuing your inventory
before your receipts.

2. What is ABC Analysis and why it is being used

 ABC Analysis is an Inventory categorization method to categorize items into 3 different
classes A being the most valuable and C being the least valuable ones.
 Using this Analysis, it will be easy to monitor and keep on track of the valuable items like
frequently doing cycle counts on A class items, etc.
3. What are the process of cycle count
 Create a cycle count header with required data
 Assign the items to be counted
 Then run the required cycle count report
 Using the report do the cycle counts
 Then go and Approve the cycle count
4. What is the different in MO Issue and MO Transfer
 MO Issue will move out the stock from inventory against an account
 MO transfer will move the stock from one subinventory to other
5. What is the Picking rule in Inventory
 Picking Rule is used to determine the list of items for sales order/ shipping based on the
revision, Lot, Subinventory and Locator.
 Assign the required Picking Rule to the item in Order Management tab.
6. What are the criteria in Cycle count
Depending on the requirement, we can trigger cycle count.
We can define regular cycle count of high values items.
If back ordered or pick denied, we can trigger cycle count for those items.
 6. What are the diff in Lot and Serial
Lot control is to control a whole batch of items. for example in drug industry we have batch
number which can be controlled using lot where we can track the complete batch using
specific data.
Serial control is to monitor and track every single qty of an item like electronic devices
where we track by serial number.
6. What are the material status in a subinventory
7. What is Physical Inventory

Part - 3

1. What is move order in OM

Move orders generated as part of Pick Wave are the ones from Sales order
2. How a MO is diff from Subinv transfer
Ans: MO generally are the request of movement of items in one organization. It may be of from 3
sources, MO requisition, Replenish MO, Pick Wave MO. MO can be MO Issue which will issue
the item from the location and MO transfer which ll transfer the item to another location.
3. What is nettable in Subinventory setup
This will detrrmine whether to consider the onhands of the subinventory as available for planning
tasks.
4. What are the status attributes in Item and how many of them
We can define different status for an item combination these attributes as per the business need
Following are the attributes
BOM Enabled
Build in WIP
Customer order enabled
Internal Order enabled
Invoicable
Purchasable
Stockable
Transactable
5. What is the use of status attribute
We can define different status for an item combination these attributes as per the business need
6. Why master org is required
So that we can have an item maintained at master level with common attributes and then we can
use the same item across multiple organization instead of defining it again and again.
7. Inventory Master org is mandatory?
Yes. If you will not create any specific master org, then system will consider the same inv org as
its master org.
8. What are the Lot control setups
Lot control can be setup at item attributes at organization level.
Either No Control or Full Control
9. How lot number generates
You can generate new Lot numbers during transactions
10. What is serial controlled and what are the setups
Serial control can be setup at item attributes at organization level.
11. How serial numbers are generated
Serial control can be setup at item attributes at organization level.
No Control, At Receipt, At Sales Order issue, Predefined
12. What is the predefined locator in Subinventory and how it works in business
We can setup locator control in 4 diff ways for each subinventory
None: There will not be any locator information required during any transaction
Prespecified: System will ask you to select locator combinations which already been defined in
the subinventory during the transaction
Dynamic Entry: Either you can select any locator during transaction or you can create a new
combination
Item Level: This will take the locator which has been defined at item attribute level
13. What are the transaction managers
Transaction manager is the inetrface managers which carry out all transaction once submitted by
the users
14. Can we change the item name after it created?
Ans: Yes we can change the name in master level.

Part -4

1. How WMS is helpful compared to Inventory

Ans: Warehouse Management (WMS) enables companies to maximize their utilization of labor,
space and equipment investments by coordinating and optimizing resource usage and material
flows. Specifically designed to support the needs of distribution, manufacturing, asset-intensive,
and service businesses, Oracle WMS provides a single-platform across your entire global supply
chain.
2. What functionality in inventory uses the calendar
3. What is the diff in inv and wms from accounting perspective
4. What is the use of WMS Rules Workbench
Ans: The Rules workbench enables you to assign strategies, rules and cost group values directly
to any number of objects in an assignment matrix
5. Why strategy used
Ans: After you define your rules, you must set up a strategy and then associate the applicable
rules. After you assign rules to a strategy, the rules engine can execute the strategies on any
objects to which the strategy applies. The rules engine executes each subsequent rule in your
strategy until an allocation is completely filled.
6. How many types of bar codes are there
Ans: Mainly 2 types Linear (1 dimensional) and Matrix (2D)
Part - 5

1. What is an item?
An item is a part or services where you can Purchase, Sell, Plan,
Manufacture, Stock, Distribute and Prototype.
Items can also be containers for items as well as components you build into
other items.

2. Explain Item Master Organization?

An item master organization is a logical entity where you define the item.
After you define an item in the item master, you can assign it to any
number of other organizations.

3. Define Inventory Organization?

It is a facility which will enable you to store and transact the items. It can be
a manufacturing unit, ware house, distribution center etc.

4. What is a subinventory?
Subinventiries are unique physical or logical separations of material
inventory. These can be raw material, finished goods or defective material
subinventory. You must define at least one subinventory. Subinventories
are of two types: storage and receiving
Storage subinventories are intermediate or final put away locations for
material. Material that resides in a storage subinventory appears in on hand
quantity, and is tracked by the system. The system can book orders
against, and use manufacturing processes on material that resides in a
storage subinventory. You must define at least one storage subinventory
for your implementation.
Receiving type subinventory is only used for receiving items. Items in this
subinventories cannot be on-hand or reserved

5. In which table does the subinventory related information for an item

is stored?
MTL_SECONDARY_INVENTORIES
MTL_ITEM_SUB_INVENTORIES

6. What is a stock locator?

Locators are structures within subinventories. Locators are the third level in
the enterprise structuring scheme of Oracle Inventory. Locators may
represent rows, racks, or bins in warehouses. You can transact items into
and out of locators. You can restrict the life of locators, establish capacity of
a specific locator in weight or units, as well as specify dimensions which
define a locator’s capacity by volume.

7. What are the Key flex fields in oracle Inventory?

Oracle Inventory provides the following flexfields:
System Items, Item Catalogs, Item Categories, Stock Locators, Account
Alias and Sales Order

8. What are the basic steps involved in defining an item?

Create an item in the item master form
Copy the template from the tools menu to assign specific attributes to the
item and save it.
Assign the item to a category from tools menu and save your work
Select organization assignment from tools menu and assign the item to
different inventory organizations by ticking the checkbox next to the
inventory organizations.

9. What are item attributes?

Item attributes are the collection of information about an item. These are
used to store specific characteristics of an item, such as item status, unit of
measure, revision control, etc. these can be controlled at either the master
or the organization level. These attributes are stored in a table named
MTL_ITEM_ATTRIBUTES

10. What is the use of item template?

An Item template is a set of attributes that enable the user to quickly create
an Item. You can use the existing templates are you can create your
custom template.

11. What is an item category and category set?

A category is a logical classification of items that have similar
characteristics.
A category set is a distinct grouping scheme and consists of multiple
categories. An item can belong to any number of category sets. We can
assign item to one category within each category set. The categories can
be retrieved from the table ‘MTL_CATEGORIES_B‘ and item category set
from ‘MTL_CATEGORY_SETS_B’.

12. Explain unit of measure (UOM) and UOM class?

The unit of measure (UOM) helps us count the number of items involved in
a transaction or the number of items that are stored in a subinventory or a
locator.
UOM classes let you group different UMO’s into one category. Eg,
quantitycould be a UOM class under which each, dozen, lot etc are
separate UOM’s.

13. Explain shipping method?

Shipping methods are the way you ship material. When you create a
shipping method, you must enable it before you can use it in a shipping
network. If you disable a shipping method, it cannot be used in a shipping
network.

14. Describe Interorganization Shipping Networks

An inter-organization shipping network describes the relationships and
accounting information between a shipping organization and a destination
organization. You must define a shipping network between two
organizations before you can transfer material between organizations.
When you set up a shipping network you must select a transfer
type:Intransit or Direct.
Intransit: Oracle Inventory moves material to an intermediary state before
it reaches the destination organization. After the material arrives at the
destination organization, you will need a receipt transaction to retrieve it. If
intransit is selected, you can define:
Shipping Methods, GL Accounts to use in transit, Material ownership during
transfer, Planning lead times and Transfer Charges
Direct: Oracle Inventory moves the material directly to the destination
organization. However, for both transfer types, you can determine default
receipt routing and whether internal orders are required to transfer material

15. In which tables are the transactional details are stored?

MTL_MATERIAL_TRANSACTIONS
MTL_TRANSACTIONS_INTERFACE
MTL_MATERIAL_TRANSACTIONS_TEMP
MTL_TRANSACTION_ACCOUNTS

16. What is revision control in Oracle Inventory?

A revision is a particular version of an item, bill of material, or routing.
Revision control is normally enabled for identifying a modified item. Item
can be placed under revision control by checking the box `Revision control`
in Inventory tab while defining new item or for existing item. Base table for
Item Revision is MTL_ITEM_REVISIONS.

17. What is Picking Order of Subinventory or Locator? Where will you

define the order?
The value indicates the priority with which we pick items from subinventory
or Locator, relative to another subinventory or locator, where a given item
resides. A picking order of 1 means that order entry functions pick items
from the subinventory or locator before others with a higher number (such
as 2,3 and so on).
The subinventory order is defined in the subinventory definition and the
locator order is defined in the locator definition. The default order for both
the subinventory and the locator are defined in the organization.

18. What are the different inventory transactions?

A transaction is an item movement within, into or out of inventory. A
transaction changes the quantity and location of an item
The following are the different inventory transactions:
Receive an item into an organization from GL account number
Issue an item from an organization into a GL account number
Transfer items from one subinventory to other in the same organization.
Transfer of items between various inventory organizations
Reservation of items

19. Describe various inventory transaction types?

Miscellaneous transaction: This transaction is used to do adjustments in
stock due to damage, obsolescence, issuing items for R & D or issuing
track able expense items.
Subinventory transfer: This transaction is used to transfer goods from one
subinventory to another within the same inventory organization.
InterORG transfer: This transaction is used to transfer goods from one
inventory organization to another.
Receiving transaction: This transaction is used to move goods from
receiving dock to specified subinventory and locator.
Sales issue: This transaction is used to move goods from pick subinventory
to staged subinventory.
WIP issue: This transaction is used to issue materials against production
orders

20. What is the difference between a subinventory transfer and a

move order?
Both these transactions are used for the movement of items from one
subinventory to the other. The difference is that move order generates a
pick slip and a subinventory transfer doesn’t.
Move order requires ‘approval’. Also, move orders create allocations. So
you can place hold on the material with the intention of picking it up a little
later. In subinventory transfer, there is no reservation / allocation.

21. What are the Components used in Customizing a Transaction?

The following are the three components used in a transaction
Transaction Source Type
Transaction Action
Transaction Type
A Transaction Source Type and a Transaction Action come together to
form a Transaction Type.

22. What is a Transaction source type?

A Transaction Source Type is defined as an entity against which Oracle
Inventory charges a transaction. The following transaction source types
come seeded with Oracle Inventory:
Purchase Order
Account Alias
Move Order
Internal Order
Standard Cost Update
Internal Requisition
Sales Order
Cycle Count
Periodic Cost Update
Physical Inventory
Account
RMA (Return Material Authorization)
Inventory
Job or Schedule

23. What is a transaction type?

A transaction type is a combination of a transaction source type and a
transaction action. It is used to classify a particular transaction for reporting
and querying purposes. Ex:
Sales order issue (txn type) + issue from stores (txn action) = sales order
(txn source type)
Move order transfer (txn type) + subinventory transfer (txn action) = move
order (txn source type)

24. Name any four purposes where miscellaneous transaction can be

used?
Cycle count adjustment, Physical inventory adjustment, adjusting inventory
quantity within an inventory organization and decrementing on-hand
balances from a subinvemtory

25. Explain inventory control?

Inventory Control is the process by which inventory is measured and
regulated according to predetermined norms such as economic lot size for
order or production, safety stock, minimum level, maximum level, order
level etc.

26. What are the objectives of inventory control?

To meet unforeseen future demand due to variation in forecast figures and
actual figures.
To average out demand fluctuations due to seasonal or cyclic variations.
To meet the customer requirement timely, effectively, efficiently, smoothly
and satisfactorily.
To smoothen the production process.
To facilitate intermittent production of several products on the same facility.
To gain economy of production or purchase in lots.
To reduce loss due to changes in prices of inventory items.
To meet the time lag for transportation of goods.
To meet the technological constraints of production/process.

27. What are the factors that affect inventory control?

Type of product
Type of manufacture
Volume of production

28. Define ABC analysis?

ABC analysis determines the relative value of a group of inventory items
based on a user specified valuation criterion.
This technique divides inventory into three categories A, B & C based on
their annual consumption value.
It is also known as Selective Inventory Control Method (SIM)

29. What is consignment inventory?

Consignment Inventory is inventory that is in the possession of the
customer, but is still owned by the supplier. In other words, the supplier
places some of his inventory in his customer’s possession (in their store or
warehouse) and allows them to sell or consume directly from his stock. The
customer purchases the inventory only after he has resold or consumed it.
The key benefit to the customer should be obvious; he does not have to tie
up his capital in inventory. This does not mean that there are no inventory
carrying costs for the customer; he does still incur costs related to storing
and managing the inventory

30. What are the different planning methods available in Oracle?

Re-order point planning
Min-Max planning
Kanban cards
Subinventory replenishment planning
31. When should the material be ordered?
When on-hand quantity + supply – demand is less than safety stock (safety
stock is nothing but minimum inventory level)
[On-hand quantity] + [supply] – [demand] < [min inventory level]

32. Explain re-order point planning?

Reorder point planning uses demand forecasts to decide when to order a
new quantity to replenish inventory. Reorder point planning suggests a new
order for an item when the available quantity (on-hand quantity plus
planned receipts) drops below the item’s safety stock level plus forecast
demand for the item during its replenishment lead-time. The suggested
order quantity is an economic order quantity that minimizes the total cost of
ordering and carrying inventory. Oracle Inventory can automatically
generate requisitions to inform your purchasing department that a
replenishment order is required to supply your organization.

If the forecast is correct and the order arrives on time, the inventory level
should be right at the safety stock level at the time of receipt. In cases
where the desired safety stock level changes during the order lead time,
Oracle Inventory uses the largest safety stock quantity during the lead-time.

When an order is triggered, the EOQ is the size of the triggered order.

EOQ = square root of: [(2 X annual demand X order cost) / (carrying cost
percent X Unit cost)]

Oracle Inventory calculates annual demand as the current demand rate

annualized by multiplying the current period demand forecast by the
number of periods per year (12 or 13).

Reorder point planning can be performed at the organization level only.

33. Explain min-max planning technique?

Min-Max planning is a tool for planning inventory that looks at user-defined
minimum and maximum inventory levels. It does not consider lead times.
We can perform this technique at org level or subinventory level

34. Define cycle counting and explain its use in oracle inventory?
Cycle Counting is a process of periodic counting of individual item / all the
items throughout the course of the year to ensure the accuracy of inventory
quantities and values.
We can do the cycle counting at Organization / Sub Inventory Level.
Cycle count is used to:
To reconcile system on-hand balances with actual counts in inventory
 Maintain control over the items that have higher value

35. When do you perform physical inventory and explain the steps
involved in it?
Physical inventory can be performed, whenever there is a need to verify the
accuracy of system on-hand quantities. This can be done for entire
organization or can be confined to a specific subinventory.
Steps to perform physical inventory:
Define physical inventory
Take a snapshot of system on-hand quantities
Generate physical inventory tags
Enter counts
Do physical inventory adjustments by approving or rejecting
Post adjustments
Purge physical inventory information

36. When can you see such scenario, item available to qty is 0 but
available to transact more than 0
If item is not reservable
If Subinventory Allow reservation is not allowed
If Item is lot controlled and lot is expired

37. From where I can see the list of time zones in oracle.
A. The list of time zones and their other details can be found from below 2
tables
fnd_timezones_b, fnd_timezones_tl

38. Can one Asset subinventory be made Non Asset subinventory

once transactions created on that?
A. Yes Asset Subinventory flag can be unchecked for that subinventory
provided

 There is no onhand present in that subinventory. If present you need to

issue out and change the flag and receive those back.
 There is no accounting details pending in inventory like transaction
happened but costing is not yet done.
With Oracle Inventory Management you can improve inventory visibility, reduce inventory
levels and control inventory operations. All of your material in each line of business and stage of
the inventory lifecycle can be tracked in a single system. Increased transparency will reduce the
need for local buffer stocks, and inventory will be located where it previously wasn’t known to
exist.

Oracle Inventory Management is part of the Oracle Value Chain Execution solution and integrates
seamlessly with other Supply Chain Management applications, including Oracle Warehouse
Management, Oracle Mobile Supply Chain Applications, Oracle Order Management, Oracle
Purchasing, Oracle Discrete Manufacturing, Oracle Process Manufacturing, and Oracle Cost
Management.
An inventory organization is a facility where you store and transact items. Before you can use
Oracle Inventory, you must define one or more inventory organizations. Inventory organizations
represent distinct entities in your enterprise and can be one of the following:

 A physical entity such as a manufacturing facility, warehouse, or distribution centre.

 A logical entity such as an item master organization, which you use to define items.
 An inventory organization can have its own location, ledger, costing method, workday
calendar, and items
 An inventory organization can share one or more of these characteristics with other
organizations.

1. What is an item?

An item is a part or services where you can Purchase, Sell, Plan, Manufacture, Stock, Distribute
and Prototype.
Items can also be containers for items as well as components you build into other items.
2. Explain Item Master Organization?
An item master organization is a logical entity where you define the item. After you define an
item in the item master, you can assign it to any number of other organizations.
3. Define Inventory Organization?
It is a facility which will enable you to store and transact the items. It can be a manufacturing
unit, ware house, distribution center etc.
4. What is a subinventory?
Subinventiries are unique physical or logical separations of material inventory. These can be raw
material, finished goods or defective material subinventory. You must define at least one
subinventory. Subinventories are of two types: storage and receiving
Storage subinventories are intermediate or final put away locations for material. Material that
resides in a storage subinventory appears in on hand quantity, and is tracked by the system. The
system can book orders against, and use manufacturing processes on material that resides in a
storage subinventory. You must define at least one storage subinventory for your
implementation.
Receiving type subinventory is only used for receiving items. Items in this subinventories
cannot be on-hand or reserved
5. In which table does the subinventory related information for an item is stored?
MTL_ITEM_SUB_INVENTORIES
6. What is a stock locator?
Locators are structures within subinventories. Locators are the third level in the enterprise
structuring scheme of Oracle Inventory. Locators may represent rows, racks, or bins in
warehouses. You can transact items into and out of locators. You can restrict the life of locators,
establish capacity of a specific locator in weight or units, as well as specify dimensions which
define a locator’s capacity by volume.
7. What are the Key flex fields in oracle Inventory?
Oracle Inventory provides the following flexfields:
System Items, Item Catalogs, Item Categories, Stock Locators, Account Alias and Sales Order
8. What are the basic steps involved in defining an item?
Create an item in the item master form
Copy the template from the tools menu to assign specific attributes to the item and save it.
Assign the item to a category from tools menu and save your work
Select organization assignment from tools menu and assign the item to different inventory
organizations by ticking the checkbox next to the inventory organizations.
9. What are item attributes?
Item attributes are the collection of information about an item. These are used to store specific
characteristics of an item, such as item status, unit of measure, revision control, etc. these can
be controlled at either the master or the organization level. These attributes are stored in a table
named MTL_ITEM_ATTRIBUTES
10. What is the use of item template?
An Item template is a set of attributes that enable the user to quickly create an Item. You can
use the existing templates are you can create your custom template.
11. What is an item category and category set?
A category is a logical classification of items that have similar characteristics.
A category set is a distinct grouping scheme and consists of multiple categories. An item can
belong to any number of category sets. We can assign item to one category within each
category set. The categories can be retrieved from the table ‘MTL_CATEGORIES_B‘ and item
category set from ‘MTL_CATEGORY_SETS_B’.
12. Explain unit of measure (UOM) and UOM class?
The unit of measure (UOM) helps us count the number of items involved in a transaction or the
number of items that are stored in a subinventory or a locator.
UOM classes let you group different UMO’s into one category. Eg, quantity could be a UOM
class under which each, dozen, lot etc are separate UOM’s.
13. Explain shipping method?
Shipping methods are the way you ship material. When you create a shipping method, you must
enable it before you can use it in a shipping network. If you disable a shipping method, it cannot
be used in a shipping network.
14. Describe Interorganization Shipping Networks
An inter-organization shipping network describes the relationships and accounting information
between a shipping organization and a destination organization. You must define a shipping
network between two organizations before you can transfer material between organizations.
When you set up a shipping network you must select a transfer type: Intransit or Direct.
Intransit: Oracle Inventory moves material to an intermediary state before it reaches the
destination organization. After the material arrives at the destination organization, you will need
a receipt transaction to retrieve it. If intransit is selected, you can define:
Shipping Methods, GL Accounts to use in transit, Material ownership during transfer, Planning
lead times and Transfer Charges
Direct: Oracle Inventory moves the material directly to the destination organization. However,
for both transfer types, you can determine default receipt routing and whether internal
orders are required to transfer material
15. In which tables are the transactional details are stored?
MTL_MATERIAL_TRANSACTIONS
MTL_TRANSACTIONS_INTERFACE
MTL_MATERIAL_TRANSACTIONS_TEMP
MTL_TRANSACTION_ACCOUNTS
16. What is revision control in Oracle Inventory?
A revision is a particular version of an item, bill of material, or routing. Revision control is
normally enabled for identifying a modified item. Item can be placed under revision control by
checking the box `Revision control` in Inventory tab while defining new item or for existing
item. Base table for Item Revision is MTL_ITEM_REVISIONS.
17. What is Picking Order of Subinventory or Locator? Where will you define the
order?
The value indicates the priority with which we pick items from subinventory or Locator, relative
to another subinventory or locator, where a given item resides. A picking order of 1 means that
order entry functions pick items from the subinventory or locator before others with a higher
number (such as 2,3 and so on).
The subinventory order is defined in the subinventory definition and the locator order is defined
in the locator definition. The default order for both the subinventory and the locator are defined
in the organization.
18. What are the different inventory transactions?
A transaction is an item movement within, into or out of inventory. A transaction changes the
quantity and location of an item
The following are the different inventory transactions:
Receive an item into an organization from GL account number
Issue an item from an organization into a GL account number
Transfer items from one subinventory to other in the same organization.
Transfer of items between various inventory organizations
Reservation of items
19. Describe various inventory transaction types?
Miscellaneous transaction: This transaction is used to do adjustments in stock due to
damage, obsolescence, issuing items for R & D or issuing track able expense items.
Subinventory transfer: This transaction is used to transfer goods from one subinventory to
another within the same inventory organization.
InterORG transfer: This transaction is used to transfer goods from one inventory organization
to another.
Receiving transaction: This transaction is used to move goods from receiving dock to
specified subinventory and locator.
Sales issue: This transaction is used to move goods from pick subinventory to staged
subinventory.
WIP issue: This transaction is used to issue materials against production orders
20. What is the difference between a subinventory transfer and a move order?
Both these transactions are used for the movement of items from one subinventory to the other.
The difference is that move order generates a pick slip and a subinventory transfer doesn’t.
Move order requires ‘approval’. Also, move orders create allocations. So you can place hold on
the material with the intention of picking it up a little later. In subinventory transfer, there is no
reservation / allocation.
21. What are the Components used in Customizing a Transaction?
The following are the three components used in a transaction

 Transaction Source Type

 Transaction Action
 Transaction Type

A Transaction Source Type and a Transaction Action come together to form

a Transaction Type.
22. What is a Transaction source type?
A Transaction Source Type is defined as an entity against which Oracle Inventory charges a
transaction. The following transaction source types come seeded with Oracle Inventory:

 Purchase Order
 Account Alias
 Move Order
 Internal Order
 Standard Cost Update
 Internal Requisition
 Sales Order
  Cycle Count
 Periodic Cost Update
 Physical Inventory
 Account
 RMA (Return Material Authorization)
 Inventory
 Job or Schedule

23. What is a transaction type?

A transaction type is a combination of a transaction source type and a transaction action. It is
used to classify a particular transaction for reporting and querying purposes. Ex:
Sales order issue (txn type) + issue from stores (txn action) = sales order (txn source type)
Move order transfer (txn type) + subinventory transfer (txn action) = move order (txn source
type)
24. Name any four purposes where miscellaneous transaction can be used?
Cycle count adjustment, Physical inventory adjustment, adjusting inventory quantity within an
inventory organization and decrementing on-hand balances from a subinvemtory
25. Explain inventory control?
Inventory Control is the process by which inventory is measured and regulated according to
predetermined norms such as economic lot size for order or production, safety stock, minimum
level, maximum level, order level etc.
26. What are the objectives of inventory control?

 To meet unforeseen future demand due to variation in forecast figures and actual
figures.
 To average out demand fluctuations due to seasonal or cyclic variations.
 To meet the customer requirement timely, effectively, efficiently, smoothly and
satisfactorily.
 To smoothen the production process.
 To facilitate intermittent production of several products on the same facility.
 To gain economy of production or purchase in lots.
 To reduce loss due to changes in prices of inventory items.
 To meet the time lag for transportation of goods.
 To meet the technological constraints of production/process.

27. What are the factors that affect inventory control?

 Type of product
 Type of manufacture
 Volume of production

28. Define ABC analysis?

ABC analysis determines the relative value of a group of inventory items based on a user
specified valuation criterion.
This technique divides inventory into three categories A, B & C based on their annual
consumption value.
It is also known as Selective Inventory Control Method (SIM)
29. What is consignment inventory?
Consignment Inventory is inventory that is in the possession of the customer, but is still owned
by the supplier. In other words, the supplier places some of his inventory in his customer’s
possession (in their store or warehouse) and allows them to sell or consume directly from his
stock. The customer purchases the inventory only after he has resold or consumed it. The key
benefit to the customer should be obvious; he does not have to tie up his capital in inventory.
This does not mean that there are no inventory carrying costs for the customer; he does still
incur costs related to storing and managing the inventory
30. What are the different planning methods available in Oracle?

 Re-order point planning

 Min-Max planning
 Kanban cards
 Subinventory replenishment planning

31. When should the material be ordered?

When on-hand quantity + supply – demand is less than safety stock (safety stock is nothing but
minimum inventory level)
[On-hand quantity] + [supply] – [demand] < [min inventory level]
32. Explain re-order point planning?
Reorder point planning uses demand forecasts to decide when to order a new quantity to
replenish inventory. Reorder point planning suggests a new order for an item when the available
quantity (on-hand quantity plus planned receipts) drops below the item’s safety stock level plus
forecast demand for the item during its replenishment lead-time. The suggested order quantity is
an economic order quantity that minimizes the total cost of ordering and carrying inventory.
Oracle Inventory can automatically generate requisitions to inform your purchasing department
that a replenishment order is required to supply your organization.
If the forecast is correct and the order arrives on time, the inventory level should be right at the
safety stock level at the time of receipt. In cases where the desired safety stock level changes
during the order lead time, Oracle Inventory uses the largest safety stock quantity during the
lead-time.
When an order is triggered, the EOQ is the size of the triggered order.
EOQ = square root of: [(2 X annual demand X order cost) / (carrying cost percent X Unit cost)]
Oracle Inventory calculates annual demand as the current demand rate annualized by
multiplying the current period demand forecast by the number of periods per year (12 or 13).
Reorder point planning can be performed at the organization level only.
33. Explain min-max planning technique?
Min-Max planning is a tool for planning inventory that looks at user-defined minimum and
maximum inventory levels. It does not consider lead times.
We can perform this technique at org level or subinventory level
34. Define cycle counting and explain its use in oracle inventory?
Cycle Counting is a process of periodic counting of individual item / all the items throughout the
course of the year to ensure the accuracy of inventory quantities and values.
We can do the cycle counting at Organization / Sub Inventory Level.
Cycle count is used to:
To reconcile system on-hand balances with actual counts in inventory
Maintain control over the items that have higher value
35. When do you perform physical inventory and explain the steps involved in it?
Physical inventory can be performed, whenever there is a need to verify the accuracy of system
on-hand quantities. This can be done for entire organization or can be confined to a specific
subinventory.
Steps to perform physical inventory:

 Define physical inventory

 Take a snapshot of system on-hand quantities
 Generate physical inventory tags
 Enter counts
 Do physical inventory adjustments by approving or rejecting
 Post adjustments
 Purge physical inventory information