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Oracle EBS R12.1 Purchasing Essentials

Question No: 11 – (Topic 1)

A multinational company is setting up the sourcing rules and approved supplier list (ASL) to source inventory items across different organizations.

Which two statements are true? (Choose two.)

  1. You do not need to create a local ASL if you create a Global ASL

  2. Inventory organizations used in the sourcing rules must be set up in the Shipping Networks.

  3. You need to match the supplier between a sourcing rule and an ASL, but not the supplier site.

  4. The country of origin must be entered in the ASL, or it would not be available on the purchasing document.

  5. A commodity can be assigned to a supplier at both the global level and at the local level, and the local level assignment takes precedence.

Answer: B,E

Question No: 12 – (Topic 1)

Which control option prevents changes or additions to the purchase order or release, but maintains the ability to receive and match invoices?

  1. Hold

  2. Firm

  3. Close

  4. Freeze

  5. Finally Close

Answer: D

Question No: 13 – (Topic 1)

An approved supplier list (ASL) is being defined in a multiorganization environment, which two statements are valid?

  1. Setting up a Global ASL is mandatory.

  2. If a supplier item has a local ASL setup, you cannot set it up on a Global ASL.

  3. The supplier for an item-supplier association must be global, while the supplier site can be local.

  4. Company X has set up Planning would source planned orders. The approval status of the supplier can be set to New or Approved.

Answer: C,D

Question No: 14 – (Topic 1)

The buyer decides to automatically update and create sourcing rules, as part of the blanket purchase agreement approval process. However, on clicking the Approve button, the buyer does not see any option to update and create blanket purchase sourcing rules.

Which profile option has the buyer failed to set up?

  1. PO: Automatic Document Sourcing

  2. MRP: Default Sourcing Assignment Set

  3. PO: Allow Auto-generate Sourcing Rules

  4. PO: Allow Autocreation of Oracle Sourcing Documents

Answer: C

Question No: 15 – (Topic 1)

A medium-sized multinational company based in US has two business groups (B6), BGI (for US) and B62 (for Europe), with position approval hierarchies HI and H2, respectively.

The company has a policy that only the Controllers and those above them can approve capital Items on requisitions and purchase orders. However, the Purchase Manager (who reports to the Controller) must also be able to authorize capital purchases.

The account range for capital items is: 2000-2599. The relevant approval limits are:

  1. Purchase Manager in both BGs: $100,000

  2. Controller in BGI: $500,000

  3. Controller in BG2: $200,000

Which two options represent a valid and efficient approval process? (Choose two.)

  1. An employee in B62 raises a requisition for $5000. This is verified by the employee#39;s manager and forwarded to the group Controller in BGI who approves it.

  2. An employee in BG2 raises a capital requisition for $250,000, which is verified by the employee#39;s manager and then forwarded to the group Controller in BG2 who approves it.

  3. The buyer hi BGI raises a standard purchase order for $250,000 with the charge account 2106. The Purchase Manager verifies it and forwards it to the controller in BGI who approves it.

  4. A buyer in BG2 raises a purchase order for $10,000 with charge for inventory items to be stocked in an asset subinventory. The Purchase Manager in BG2 verifies and forwards it to the Controller in BG2.

  5. The shop floor supervisor in BGI raises a requisition for a new drilling machine for

    $250,000. The supervisor#39;s manager (Production Manager) verifies the requisition and forwards it to the Controller in BGI for a final approval.

  6. The Purchase Manager in BG2 raises a requisition for $5000 for computer equipment. The Controller in B62 approves it and instructs the buyer to ensure a 2-year warranty on this equipment. The buyer in BG2 places the order on the supplier.

Answer: C,F

Question No: 16 – (Topic 1)

When implementing Purchasing at FGH Corp., you notice several administrative inefficiencies due to a poorly maintained supplier list. Identify three inefficiencies. (Choose three.)

  1. entering suppliers twice

  2. issuing specific invoices

  3. generating inaccurate returns

  4. generating inaccurate receipts

  5. generating accurate supplier reports

  6. issuing more payments than necessary

  7. issuing more purchase orders than necessary

Answer: A,F,G

Question No: 17 – (Topic 1)

Your customer wants to convert both RFQs and Quotations to have tracking for Small Business Audit trail. The volume for Quotations is very high and only Approved RFQs and Quotations are being converted. What would you recommend as the best conversion strategy for RFQs and Quotations?

  1. Data Load both RFQs and Quotations.

  2. Manually enter both RFQs and Quotations.

  3. Manually enter RFQs, and Data Load Quotations.

  4. Use the Purchase Documents Open Interface for both RFQs and Quotations.

  5. Use the Purchase Documents Open Interface for RFQs and Data Load Quotations,

  6. Manually enter RFQs, and use the Purchase Documents Open Interface for the loading of Quotations.

Answer: F

Question No: 18 – (Topic 1)

Your company often orders Items that are sourced from multiple suppliers. At any given time, the supplier varies depending on the supplier#39;s current production capability and price offering. The price varies throughout the year. For a particular Item, there is no single supplier that receives the majority of the orders.

What is the best way to set up this Item?

  1. Create blanket purchase agreements, a sourcing rule identifying all the possible suppliers, and approved supplier list entries.

  2. Create contract purchase agreements, a sourcing rule identifying all the possible suppliers, and approved supplier list entries.

  3. Do not create blanket or contract purchase agreements or sourcing rules. Manually AutoCreate requisitions onto standard purchase orders.

  4. Create a blanket purchase agreement for only one supplier, a sourcing rule for just that supplier, and an approved supplier list entry for that supplier.

  5. Create a contract purchase agreement for only one supplier, a sourcing rule for just that supplier, and an approved supplier list entry for that supplier.

Answer: C

Question No: 19 – (Topic 1)

Which four are supported by the Receiving Open Interface (ROI)? (Choose four.)

  1. Unordered receipt

  2. Dynamic locators

  3. Deliver transactions

  4. Movement statistics

  5. Correct transactions

  6. Receive transactions

  7. Transfer transactions

Answer: C,E,F,G

Question No: 20 – (Topic 1)

The following transactions occurred at BUY Co., where you implemented the ERS functionality in Oracle Purchasing:

Purchase order unit price: $10

Receipt #1001: 150 units (gross of 50 units returned at the time of receiving) Receipt #1002: 250 units

The Pay on Receipt process is run nightly, with the summary level set to Pay Site at the supplier site. The aging period is 0.

What would the Pay on Receipt process generate for these transactions?

  1. a $3500 invoice

  2. a $4000 invoice

  3. a $50 invoice and a $2500 invoice

  4. a $1500 invoice, a $2500 invoice, and a $50 debit memo

  5. a $1000 invoice, a $2500 invoice, and a $50 debit memo

Answer: A

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