Exercise- Process a sales order-initiated intercompany chain

Completed

Scenario

Contoso Retail Miami 3005 has ordered items from USRT. Unfortunately, no inventory is available. Therefore, you must order these items from USMF.

You create an original sales order for the Northwind Traders customer. Then, you create a purchase order directly from the Sales order page. Intercompany vendor 9001 (which is linked to the USMF company through the intercompany setup) is set up as a standard vendor for the ordered item. Therefore, you create an intercompany sales order in the USMF company account for customer 3005 (the customer in the USMF company that's linked to the USRT company through the intercompany setup).

The sales order-initiated intercompany chain is also known as the three-legged chain.

Create a sales order-initiated intercompany chain

To create a sales order-initiated intercompany chain, follow these steps:

1. Start in USRT and go to Modules > Sales and marketing > Sales orders > All sales orders.

2. Select New on the Action Pane to create a new sales order.

3. Select customer account 3005 Contoso Retail Miami on the Create sales order page.

4. Select OK on the Create sales order page.

5. In Sales order lines, add item 0001 in the Item number dropdown list.

6. Enter a value of 4 in the Quantity field. The site and warehouse fields should auto populate. If not, select any values.

7. Unit price of 69.99 should default. Select Save.

8. Select the Sales order tab on the Action Pane.

9. Select Purchase order in the New group of the Action Pane.

10. Select the Include checkbox in the line with the item.

11. Verify that vendor 9001 is selected in the Vendor account field.

12. Select OK. The Automatic purchase creation message should appear. Next, a message should appear indicating that the intercompany sales order is created. Then, another message should appear indicating that the purchase order is created.

13. Close all pages.

Process the intercompany sales order

Now, you need to process the intercompany sales order. As part of the sales order processing, you need to update the ordered quantity to 4.00.

Process the intercompany sales order for customer US-040 in USMF

In this next task, you process the intercompany sales order for customer US-040 in USMF by following these steps:

1. Go to Sales and marketing > Sales orders > Intercompany orders.

2. Select the intercompany order (such as usrt000183) to packing slip update.

3. Select the PICK AND PACK tab on the Sales order page.

4. Under the GENERATE group, select Post packing slip.

5. Under the PARAMETER group, verify that Packing slip is selected in the Quantity field. A quantity of 4.00 should default in the Lines section of the Update field.

6. Select OK.

7. When the system prompts you, select OK to post the document without printing it.

8. Verify that the system updates the sales order status to Delivered.

Process the original sales order for customer Northwind Traders in USRT

To process the original sales order for the Northwind Traders customer in USRT, follow these steps:

1. Go to Sales and marketing > Sales orders > All sales orders.

2. Select the sales order for customer Northwind Traders (such as 000183).

3. On the Action Pane, select PICK AND PACK. Under GENERATE, select Post packing slip.

4. On the Packing slip posting page PARAMETER group, verify that Packing slip is selected in the Quantity field.

5. On the Packing slip posting page, verify that the quantity of 4.00 defaults in the Lines section of the Update field.

6. Select OK.

7. When the system prompts you, select OK to post the document without printing it.

8. Verify that the system updates the sales order status to Delivered.

Create an intercompany chain (two-legged chain) manually

USRT's customer, Football Stadium (1002), orders two units of item number 0001.

Because USRT has no available inventory for this item, you must create an intercompany purchase order from the intercompany vendor 9001 USMF.

Create the intercompany purchase order in USRT

Follow these steps to create the intercompany purchase order in USRT:

1. Go to Accounts Payable > Purchase orders > All purchase orders.

2. Select NEW on the All purchase orders page to create a new purchase order.

3. On the Create purchase order page, select Vendor account 9001. Under INTERCOMPANY, verify that Intercompany is set to Yes.

4. Select OK.

5. In Purchase order lines, add item number 0001.

6. In the Quantity field, enter 10.

7. Select Save.

8. Select PURCHASE on the Action Pane, and under ACTIONS, select Confirm to confirm the purchase order.

9. Close the purchase order.

10. In USMF, go to Sales and marketing > Sales orders > Intercompany orders.

11. Verify that the new intercompany sales order is created.

Update the intercompany sales order packing slip in USMF

Next, you need to update the intercompany sales order packing slip in USMF by following these steps:

1. Start in USMF and go to Modules > Sales and marketing > Sales orders > Open orders > Intercompany orders.

2. Select the intercompany sales order to generate the packing slip.

3. On the PICK AND PACK tab of the Action Pane, under the GENERATE group, select Generate picking list.

4. On the Posting picking list page, under PARAMETER, verify that All is selected in the Quantity field.

5. Select OK.

6. When the system prompts you, select OK to post the document without printing it.

7. On the Sales order page, on the PICK AND PACK tab of the Action Pane, under the GENERATE group, select Post packing slip.

8. On the Packing slip posting page, under PARAMETER, verify that Picked is selected in the Quantity field.

9. Select OK.

10. If the system prompts you, select OK to post the document without printing it.

11. On the INTERCOMPANY ORDERS page, verify that the system updates the sales order status to Delivered.

Update the purchase order packing slip in USRT

Follow these steps to update the purchase order packing slip in USRT:

1. Start in USRT and go to Modules > Procurement and sourcing > Purchase orders > All purchase orders.

2. Select the intercompany purchase order to generate the product receipt.

3. On the RECEIVE tab of the Action Pane, under the GENERATE group, select Product receipt.

4. On the Posting product receipt page, under PARAMETERS, verify that Ordered quantity is selected in the Quantity field.

5. Select OK in the lower part of the page.

6. On the Purchase order page, verify that the purchase order status shows as Received.

Update the intercompany sales order invoice in USMF

To update the intercompany sales order invoice in USMF, follow these steps:

1. Start in USMF and go to Modules > Sales and marketing > Sales orders > Open orders > Intercompany orders.

2. Select the intercompany sales order to generate the invoice.

3. On the INTERCOMPANY ORDERS page, select the INVOICE tab. Under the GENERATE group, select Invoice.

4. On the Posting invoice page, under PARAMETER, verify that Packing slip is selected in the Quantity field.

5. Verify the information in the Lines FastTab (in other words, Site = 1, Warehouse = 13, Update = 10) and then select OK.

6. When the system prompts you, select OK to post the document without printing it.

7. On the INTERCOMPANY ORDERS page, verify that the sales order status shows as Invoiced.

Update the purchase order invoice in USRT

To update the purchase order invoice in USRT, follow these steps:

1. Go to Procurement and sourcing > Purchase orders > All purchase orders.

2. Select the intercompany Purchase order to generate the invoice.

3. On the INVOICE tab of the Action Pane, under the GENERATE group, select Invoice.

4. In the Lines section on the VENDOR INVOICE page, under INVOICE DATES, enter an invoice date in the Invoice date field.

5. From the Action Pane, select the Match product receipts button to match the product receipts to the invoice.

6. On the Match product receipts to invoice page, select OK in the lower part of the screen.

7. Select Post on the Action Pane so that the system can post the invoice.

8. On the ALL PURCHASE ORDERS page, verify that the purchase order status is Invoiced.

Auto create a direct delivery intercompany order chain (three-legged chain)

Football Stadium 1002 is the only customer who orders item number 0001. You have no available inventory and must purchase this item from your intercompany vendor 9001.

Set up the customer for automatic creation of intercompany orders

To set up the customer for automatic creation of intercompany orders, follow these steps:

1. Start in USRT, go to Modules > Sales and marketing > Customers > All customers, and then select account 1002 Football Stadium.

2. On the Miscellaneous details FastTab, under the AUTOMATIC NOTIFICATION AND CANCELLATION PROCESSING group, verify that the Create Intercompany orders and the Direct delivery options are set to Yes.

Set up a primary vendor for item 0001

Follow these steps to set up a primary vendor for item 0001:

1. Go to Product information management > Products > All products and product masters and then select Account 1002 Football Stadium.

2. On the RELEASED PRODUCT DETAILS page, select the Edit button and then go to the Purchase FastTab.

3. Under the ADMINISTRATION group, in the Vendor field, select 9001.

4. Select Save.

Create the intercompany chain automatically

To automatically create the intercompany chain, follow these steps:

1. In USRT, go to Sales and marketing > Sales orders > All sales orders.

2. Select NEW on the Action Pane to create a new sales order.

3. Select customer account 1002 Football Stadium on the Create sales order page.

4. Select OK on the Create sales order page.

5. In Sales order lines, select item 0001 (the item to be sold) from the Item number dropdown list.

6. Enter a value of 4 in the Quantity field. Site 1 and Warehouse 11 should default, and the Unit price field value should default.

7. Select Save.

8. Select the SELL tab.

9. Under GENERATE, select Confirm sales order, and then select OK on the Confirm sales order page.

10. When the system prompts you, select OK to post without printing.

    A notification in MESSAGES displays, stating that "Intercompany sales order usrtXXX has been created." Then, another notification in MESSAGES displays, stating that "Purchase order 0000XX has been created."

11. In USRT, go to Accounts payable > Purchase orders > All purchase orders. Verify that a new purchase order for vendor 9001 is created for 4.00 pieces of item 0001.

12. In USMF, go to Sales and Marketing > Sales orders > All sales orders > Intercompany orders.

13. Verify that the new intercompany order is created for customer US-040 for 4.00 pieces of item 0001.

Set up an intercompany chain with automatic picking list creation

The sales company USMF and the production company USRT are working closely together. After you create a new intercompany chain, you must start the picking procedure in USMF without any manual interaction. Therefore, the system must generate and print the picking list automatically.

Create an intercompany chain with automatic picking and printing of picking list

To create an intercompany chain with automatic picking and printing of the picking list, follow these steps:

1. In USMF, go to Sales and Marketing > Customers > All customers.

2. Select the USRT US-040 customer account.

3. Select Edit.

4. On the ALL CUSTOMERS page, on the GENERAL tab, under the SET UP group, select Intercompany on the Action Pane.

5. Select Sales order policies.

6. Select the Print picking list automatically parameter and then select Save.

7. In USMF, go to Accounts receivable > Setup > Accounts receivable parameters.

8. Select General.

9. In Sales default values, select Automatic in the Reservation field.

10. On the Accounts receivable parameters page, select Updates. On the Picking list FastTab, select Completed for the Picking route status.

Create a sales order line item

Next, you create a sales order line item by following these steps:

1. In USMF, go to Sales and Marketing > Sales Orders > All sales orders.

2. Select New to create a new sales order.

3. On the Create sales order page, select the US-040 customer account.

4. On the General FastTab, verify that Yes is selected under the INTERCOMPANY group.

5. In the Sales order lines on the SALES ORDER page, select 0001 in the Item number field. Quantity should default to 1.00.

6. Select Header.

7. On the Intercompany settings FastTab, set the Autocreate Intercompany orders and the Direct delivery options to Yes.

8. On the SELL tab, under the GENERATE group, select Confirm sales order. Select OK on the Confirm sales order page.

9. When the system prompts you, select OK to post without printing.

10. On the PICK AND PACK tab, under the GENERATE group, select Generate picking list.

11. Select OK on the Posting picking list page. A notification appears stating that an intercompany purchase order has been created in USRT.

Work with the Intercompany on-hand page

Football Stadium 1002 is the only customer who orders item number 0001. USRT needs to know the amount of their own available inventory and the available inventory for their intercompany vendor Contoso Entertainment Systems USA (9001).

View available inventory in the intercompany chain for all item and inventory dimensions

To view the company's available inventory in the intercompany chain for all item and inventory dimensions, follow these steps:

1. Go to Inventory management > Inquiries and reports > On-hand list.

2. Filter by item number 0001 and then select Apply.

3. Select the Intercompany on-hand option. Information such as Physical inventory, Physical reserved, Available physical, and Total available displays for USRT and USMF.

Configure intercompany information flow

A representative from Football Stadium 1002 inquires about the status of the order. You need to view the status of the corresponding sales or purchase order to determine whether it has already been picked, delivered, or received.

View related orders

Your first task is to view related orders by following these steps:

1. In USRT, go to Sales and marketing > Sales orders > All sales orders.

2. Open the desired sales order.

3. Select the MANAGE tab.

4. Under the INTERCOMPANY TRACKING group, select Intercompany sales order or Purchase order.