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Introduction:
The Material master is the Top, Bottom Left, Right and Central Master record for logistics, because it contains information on all the materials that a company Procures/ Manufactures/ Stores / Sells. Having a robust Material Master records helps prevent supply gaps and shortage of inventory thus improves the supply chain’s efficiency. In this connection A material master record is displayed below in crisp as far as any industry is concern.
Details:
The data stored in the Material master are required for activities such as Purchasing data for material ordering purposes, data required in Inventory management for goods movement postings, data in accounting for valuation of materials and Material requirement Planning for producing final products [1].
Creation of a Material Master Record:
Material Type:
The requirement of the material type will arise when we create a material master record, we must choose a material type and industry sector we belong to which assign the material. The similar properties of the materials are assigned to the same material type such as raw materials, Semi finished materials and so on [2]. The controlling parameters of material types and industry sector are shown.
Pre-configured material types in SAP:
In spite of having preconfigured material types in SAP system we can also create new materials by copying a standard material type and tweak the required changes. The customized material type is shown.
Industry Sector:
It indicates that the assignment of a material to a certain branch of industry such as construction industry procures cement as a raw material,
Automotive industry procures gear box assembly as a semi finished type material etc. Industry sector also has the control functions like material types as shown. The industry sector cannot be changed once it is created during the material master record. An Industry sector options can be seen in the dropdown.
Material valuation (Price Control):
The stock value of a material is determined by material valuation. The stock value can be calculated by the following relationship.
Stock Value = Stock Quantity × Material Valuation Price
Total value of the goods is updated in the Material Master Record and accounts in the Financial Accounting are updated During the valuation of a goods movement.
Material valuation is the link between Materials Management (MM) and Financial Accounting (FI) because the material valuation updates the G/L accounts in Financial
Accounting.
The material valuation or the price control set in the Material Master Record controls the value used to evaluate the material during the Goods receipt of a material. The material valuation is conceded as per the Standard (S) or Moving Average (V) price.
Valuation Class:
During the goods movement of a material, the valuation class determines which stock account needs to be updated. The valuation class is assigned to a particular material type, so that the valuation class to combine materials for assigning G/L accounts so that we do not have to maintain separate stock account for each material. The pictorial representation of the same is shown .
Conclusion:
The combination of all material data in a single material database eradicates the problem of data redundancy and licenses the data to be used not only by purchasing but also by other applications such as Inventory management, Material Requirement Planning for different necessities, Invoice verification and so on. In a nutshell, the MOM (often referred to simply as the “Material Master” comprising all the specific material master records stored in the system) is the MOTHER of SAP and plays a vital role in Enterprise Resource Planning for the hassle free business activities by preventing supply gaps and prevents the shortage of inventory leads to the high supply chain’s efficiency.
