free goods , contract, creating order

[Former Member]

Hello SAP Prof,

1. what is the diff b/w Free goods and Bonus buy?

2. What is Rental Contract and service contract?

3. How can we create our own order ,

( we can copy std order.) But plz tell me how to create order with copy controls in detail.

[Former Member · Accepted solution]

Hi Rajesh

Free goods are considered to be merchandise, moveable belongings or personal property. Free goods are those which economists are not interested in because in free goods doe not offer the opportunity for creating a cost for usage. The best example of free goods is air because there is no scarity of air. Economists are interested only in goods, which can be manipulated to create cost for useage. Free goods are plentiful, you have as much as you want without a chance for future cost to society.

A bonus buy refers to any product manufactured or otherwise made available for purchase at a lower cost for a certain period of time. A bonus buy can relate to food, cars, stocks, bonds, insurance, bank loans or almost any product you can think of.

Examples of Bonus buys are: Buy one and get one free, 20% original price, 15% Reduced Mortgage today.

SERVICE CONTRACT:

A service contract is an arrangement between a service provider and service recipient and is characterized by a separate lease and service contract term. The lease usually ranges from 22 to 27 years while the service contract ranges from 13 to 18 years in length. The combination of the lease and service contract terms is typically 80% of the useful life of the asset. While the equity return is based on the overall term, depreciation occurs over 125% of the lease term only which differs from a pickle structure where depreciation occurs over the entire deal term. The participants in this type of transaction are the service provider or lessor, service recipient or lessee, operator, and customer. Typically, a service contract is used with assets such as gas, water, and power distribution networks and generation facilities. However, they can also be applied to real estate and securitization transactions.

A service contract is considered a property lease under section 7701(e) of the IRS Code if certain requirements hold. These requirements are divided into general and special criteria groups. Section 7701(e) outlines six criteria in the general case which indicate when a service contract should actually be classified as a lease:

If the service recipient is in physical possession of the property

If the service recipient controls the property

If the service recipient has a “significant” economic interest in the property

If the service provider has no economic risk in the contract

If the service provider does not provide services to a third party

If the contract price does not “substantially” exceed the rental value of the property

To obtain classification as a service contract, the first two rules essentially require a management contract so that the service provider maintains control of the property. The service recipient is allowed to retain an interest in the land underlying the asset via a ground lease without being considered in physical possession of the property. However, they will not be able to mandate how the property is maintained, operated, or improved. There are five rules to consider which determine “significant” economic interest in a property:

If the property is utilized by a service recipient for most of its useful life

If the service recipient bears the risk of a decline in value of the property

If the service recipient shares the reward for an increase in value of the property

If the service recipient receives a portion of savings in operating costs

If the service recipient bears the risk of damage or loss of the property

To be considered a service contract, the fourth general rule requires the service provider to bear the risk of reduced receipts or increased expenses as the result of non-performance under the contract. An exception to this rule is a provision which allows for an output contract to remain in force during short shut-downs of a facility. To resemble a service contract, the fifth rule states that services must be provided to someone other than the service recipient. For example, a purchaser of power should allow sales to customers and not use all of it for themselves. The last rule states that the total contract price should “substantially” exceed the value of the property to be classified as a service contract. Thus, if the contract price is derived mostly from recovery of costs of the property or there is a separation between use and service charges of the property, then the contract will resemble a lease.

An important item to note is that not all six requirements need to be satisfied to be considered a service contract. Section 7701(e) does not weight any of the criteria but simply allows for a contract either resembling a lease or a service contract. This would imply that a simple majority of criteria is necessary for classification.

Section 7701(e)(3) provides special rules for determining whether a contract is a service contract. These special rules apply only to the following types of facilities: qualified solid waste disposal, cogeneration, alternative energy, and water treatment works. The following four special rules replace the general rules for the above facility types and indicate when a service contract should actually be classified as a lease:

If the service recipient operates the facility

If the service recipient risks a significant financial loss when there is non-performance under the contract

If the service recipient risks a significant financial gain when operating costs are less that the standards of performance under the contract

If the service recipient has a purchase option or is required to buy all or part of the facility at a fixed price other than the fair market value

There are three main differences between the special and general rules. The first one is that with the special rules, lower operating costs cannot be passed on to the service recipient. Secondly, the risk of temporary shut down of the facility can be shared by the service recipient. Lastly, all costs and benefits due to changes in the law can be passed on to the service recipient.

Service contracts have less tax downside and less financial risk as well as more even returns over time. Also, the contract must be carefully structured to qualify as a service contract. While it is easier to qualify under the special rules, there are many fewer available facilities. The main tax benefit for classification as a service contract is the allowance for depreciation over 125% of the lease term rather than 125% of the combined lease and service contract terms.

RENTAL CONTRACT

A rental agreement is a contract, usually written, between the owner of a property and a renter who desires to have temporary possession of the property. As a minimum, the agreement identifies the parties, the property, the term of the rental, and the amount of rent for the term. The owner of the property may be referred to as the lessor and the renter as the lessee.

COPY CONTROL

Copy Controls

The Copy controls enable a Document in SD to be created by referring to an existing document

Document referred: Source document

Document created: target document

Copy controls enable data to be copied from source to Target document

Copy controls to be maintained for Header, Item, Schedule line

QT---OR

Header Header

Item Item

Schedule line schedule line

Copy controls have 3 controls

a) Copying requirements

b) Data transfer routines (a program)

c) Switching requirements

Copying requirements: only if the requirement is met copying takes place

IMG—SD—sales—Maintain copy controls for Sales documents

Copying control sales document to sales document

Header

Position

Target: OR

Source: QT

Select OR+QT and then select details button

We can see Copy controls

Copying requirement: Same Customer

Only if the requirements met then only Copying possible

Data transfer routines

a) General header data

b) Business data

c) Partners

Switching requirement: Copy item number

Only those items cleared for copying will be copied into target document with item numbers unchanged

Item level Copy Controls

First select combination OR+QT

Click item

Select Item category of source document and select Details button=AGN

Copy controls for item level

Requirement: item rejection reason

Only those items which are not rejected in source document will be copied into target doc

Switching requirements: Copy schedule lines

Activate document flow at item level

This automatically updates item status in the reference document and new document

+Ve/ -ve qty

Quotation 200302 AGN

10 M1 100 Pcs

Copied into order 25 pieces TAN

Completed qty= 25

2nd copy

Copied 50 nos

Completed item = 25+50=75

This means there is + ve effect on Completion qty

-ve effect exists in the case of item level copyng from credit note in the case contracts

Pricing type: Pricing type controls how the pricing to be determined in target documents

Example:

a) Copy all pricing elements unchanged and redetermine scales

This can be overruled by update Control in the Pricing

Schedule line

Select OR+ QT

Select schedule line

Select schedule line category BN

Select Details

Copying requirements:

Schedule line qty>0 then only copy

Note1: when we create a new document by copying standard document, copy controls also get copied

Note2. Copy controls can be seen at all different times of documents like sales, delivery and billing in customization

Reward if useful to u

null

[Former Member]

Hi Rajesh,

1.Differece Between Free Goods and Bonus buy:

Free goods are either inclusive or exclusive if a customer orders for 10 products he will get 1 free for that no price is charged this is exclusive scenario

If a customer orders 10 products he will get 9+1 for 1 product he will not charged this inclusive scenario

For bonus buy if a customer orders regularly 10 products in one occasion if he orders 1000 products he will be given less price than the price he will get for 10 products this bonus buy scenario

Or

Free goods are considered to be merchandise, moveable belongings or personal property. Free goods are those which economists are not interested in because in free goods doe not offer the opportunity for creating a cost for usage. The best example of free goods is air because there is no scarcity of air. Economists are interested only in goods, which can be manipulated to create cost for usage. Free goods are plentiful; you have as much as you want without a chance for future cost to society.

A bonus buy refers to any product manufactured or otherwise made available for purchase at a lower cost for a certain period of time. A bonus buy can relate to food, cars, stocks, bonds, insurance, bank loans or almost any product you can think of.

Examples of Bonus buys are: buy one and get one free, 20% original price, 15% Reduced Mortgage today.

Free Goods:

A bonus buy refers to any product manufactured or otherwise made available for purchase at a lower cost for a certain period of time. A bonus buy can relate to food, cars, stocks, bonds, insurance, bank loans or almost any product you can think of.

Examples of Bonus buys are: buy one and get one free, 20% original price, 15% Reduced Mortgage today.

Bonus Buy: [VBK1] T.Code

example TV---10000

DVD 5000

total 15000

if u go for bonus buy u will get both for 12000

2.Service Contract

Service Contracts(WV):

When the business is providing service for the sake of Monitory consideration, Service Contract can be entered.

For service contract, separate pricing procedure can be used. Ex.: PSER01 – Standard Pricing Procedure for Service Contract. The condition type that is used is PPSV.

You use service contracts to record the details of the service package that you have agreed to provide a service recipient with over a specified period of time. For example, you specify:

The routine service tasks which are to be performed on a piece of machinery you have sold or rented to a customer

The prices which are to apply for these routine tasks

Sales document type used to control service contract processing. There are two service contract types in the standard SAP System:

Rental contract (MV)

Maintenance contract (WV)

Element of the service contract in which you define the services or products you are providing the customer with under the terms of the service contract. A service contract item can be any of the following:

Service (for example, a particular task)

Material (for example, a spare part)

Time (for example, an hourly rate for a technician’s time on the job)

Response time (how soon you are obligated to respond to a problem call)

Warranty (the agreed duration and coverage)

The items in a service contract are controlled by item category. It is possible for a service contract to include items with different item categories. For example, some items may be rented, others sold.

Rental Contract:

pl's refer the links below.

http://help.sap.com/bp_profservicev1600/ProfServ_DE/documentation/PS_1600_Solution_Scope_EN_DE.doc

http://www50.sap.com/businessmaps/A9579BCF28A94847ADA22A74F8116B02.htm

http://help.sap.com/saphelp_erp2005vp/helpdata/en/5e/69a1228f6211d2a9f60000e8a6f09e/frameset.htm

This can be configured using Periodic Billing.

1. Create New Sales Order Type, say ZOR (Copy of OR) through T.Code: VOV8

Maintain Delivery Type as LF & Billing Type As 'F1' - Order Related / 'F2' Delivery Related.

IMG > Sales and Distribution > Sales > Sales Documents > Sales Document Header > Define Sales Documents Types

2. Assign New Sales Document Type to Sales Area, For Eg:

1000 (S.Org) / 10 (D.Channel) / 10 (Division) / ZOR (S.O Type)

IMG > Sales and Distribution > Sales > Sales Documents > Sales Document Header > Assign Sales Area to Sales Document Type

3. Create New Item Category, say ZTAN - Copy of TAN (For delivery Related) / ZTAD - Copy of TAD (For Order realted) / ZTAS - copy of TAS (For Third Party)

Maintain as under (others remaining same)

Billing Relevance: I

Billing Plan Type: 02

IMG > Sales and Distribution > Sales > Sales Documents > Sales Document Item > Define Item Category

4. Assign Item Category, for ex (assuming Usage & higher level item category as blank):

Sales Document Type | Item Category Group | Default Item Category

ZOR | NORM | ZTAN

ZOR | DEIN | ZTAD

ZOR | BANS | ZTAS

IMG > Sales and Distribution > Sales > Sales Documents > Sales Document Item > Assign Item Category

Note: In the above Billing Type '02' plays the main controller for periodic billing. while execution of process some messages pop-up with respect to date, just press enter & skip them. In Sales order, at item level, we require to maintain the billing plan.

Follow the Sales cycle as normal sales cycle for particular Scenarios

3.Please copy the existing sales document type OR and Rename it as ZOR / YOR.

You need to do necessary config setting for this like assigning to item category and assigning to respective Sales Area and so on.

Regarding Copy Control please do the Following:

You must also make specifications for copying requirements and data transfer, as well as quantity and value updates in document flow. This must be done for each copying procedure at header, item and, if necessary, schedule line level on a detail screen.

In SD make sure to maintain copy control for the following areas:

Sales documents

Deliveries

Billing documents

In sales, you can find copy controls for:

Sales document by sales document

Billing document by sales document

In deliveries, you can find copy controls for:

Sales document by delivery

In billing, you can find copy controls for:

Sales document by billing document

Delivery by billing document

Billing document by billing document

The transaction codes for copy controls are

VTLA order type to delivery type

VTAA order type to order type

VTFL delivery type to billing doc type

VTFA order type to billing doc type

VTFF billing doc type to billing doc type

VTAF billing doc type to order type (example would be Returns).

Hope this gives the solution to your Thread and Please Reward If Really Helpful,

Thanks and Regards,

Sateesh.Kandula

[former_member227476]

dear rajesh

. What is the difference between free goods and bonus buy?

Free goods are either inclusive or exclusive if a customer orders for 10 products he will get 1 free for that no price is charged this is exclusive scenario

If a customer orders 10 products he will get 9+1 for 1 product he will not charged this inclusive scenario

For bonus buy if a customer orders regularly 10 products in one occasion if he orders 1000 products he will be given less price than the price he will get for 10 products this bonus buy scenario

Or

Free goods are considered to be merchandise, moveable belongings or personal property. Free goods are those which economists are not interested in because in free goods doe not offer the opportunity for creating a cost for usage. The best example of free goods is air because there is no scarcity of air. Economists are interested only in goods, which can be manipulated to create cost for usage. Free goods are plentiful; you have as much as you want without a chance for future cost to society.

A bonus buy refers to any product manufactured or otherwise made available for purchase at a lower cost for a certain period of time. A bonus buy can relate to food, cars, stocks, bonds, insurance, bank loans or almost any product you can think of.

Examples of Bonus buys are: buy one and get one free, 20% original price, and 15% Reduced Mortgage today.

rewards if it helps

siva

[karan_ghule]

I have a requirement where if the customer orders three different goods then material that has less price will be given as a free.