15 SAP SD Interview Questions and Answers

SAP Sales and Distribution (SD) is a critical module within the SAP ERP system, designed to manage and optimize the sales and distribution processes of an organization. It integrates seamlessly with other SAP modules such as Material Management (MM) and Finance (FI), providing a comprehensive solution for managing customer orders, pricing, billing, and shipping. Mastery of SAP SD is essential for professionals aiming to streamline business operations and improve customer satisfaction.

This article offers a curated selection of interview questions tailored to assess your understanding and proficiency in SAP SD. By reviewing these questions and their detailed answers, you will be better prepared to demonstrate your expertise and problem-solving abilities in SAP SD during your interview.

SAP SD Interview Questions and Answers

1. Explain the purpose of Sales and Distribution (SD) module.

The Sales and Distribution (SD) module in SAP streamlines the sales and distribution process within an organization. It manages customer relationships, sales orders, pricing, billing, and shipping, ensuring efficient delivery of products and services.

Key components include:

• Sales Order Processing: Manages sales orders, ensuring accurate and timely processing.
• Pricing and Taxation: Calculates prices, discounts, and taxes, ensuring compliance with regulations.
• Billing: Generates customer invoices, ensuring accuracy and adherence to sales order terms.
• Shipping and Delivery: Manages logistics, including shipping documents, delivery tracking, and returns.
• Credit Management: Monitors customer credit limits to minimize bad debts.
• Sales Reporting and Analytics: Analyzes sales data to support informed business decisions.

2. Describe the process of creating a sales order.

Creating a sales order in SAP SD involves several steps, starting with entering customer and material information, followed by configuring pricing, availability checks, and delivery schedules:

• Customer Information: Enter customer details from the master data, including billing and shipping addresses.
• Material Information: Enter product details, including quantity and any additional specifications.
• Pricing: The system determines pricing based on predefined conditions.
• Availability Check: Verifies stock availability or production capability to meet delivery dates.
• Delivery Schedule: Configures delivery dates and quantities.
• Credit Check: Ensures the customer has sufficient credit.
• Order Confirmation: Generates and sends an order confirmation to the customer.

3. What are the key components of a pricing procedure?

In SAP SD, a pricing procedure determines product and service prices. Key components include:

• Condition Types: Represent pricing elements like base price, discounts, and taxes.
• Access Sequence: Defines the order for searching valid condition records.
• Condition Tables: Store condition records for pricing elements.
• Pricing Procedure Determination: Assigns a pricing procedure to a sales document.
• Condition Exclusion: Excludes certain condition types based on rules.
• Pricing Scales: Define price levels based on quantities or values.

4. What is the significance of the condition technique?

The condition technique in SAP SD determines pricing elements like prices, discounts, and taxes. It involves:

• Condition Tables: Store condition records.
• Access Sequence: Defines the search order for condition records.
• Condition Types: Represent pricing elements.
• Pricing Procedure: Combines condition types to calculate the final price.

The process involves searching for valid condition records, applying condition types, and calculating the final price.

5. Explain the concept of availability check and how it is configured.

The availability check in SAP SD verifies if the requested product quantity can be fulfilled by the desired delivery date. It considers stock, planned receipts, and planned issues.

Configuration involves:

• Define Checking Groups: Determine how the system handles availability checks.
• Assign Checking Groups to Material Master: Dictates how checks are performed for each material.
• Define Checking Rules: Specify conditions for availability checks.
• Configure Scope of Check: Define elements considered during checks.
• Maintain Availability Check Control: Set control parameters for unavailable quantities.

6. Describe the process of credit management.

Credit management in SAP SD involves:

1. Credit Control Area Configuration: Represents the area where customer credit is managed.

2. Credit Master Data: Sets up credit limits for customers.

3. Credit Exposure: Total credit utilized by a customer.

4. Credit Checks: Automated checks during sales order processing.

5. Credit Block: Blocks sales orders if credit exposure exceeds limits.

6. Credit Release: Manually or automatically releases blocked documents.

7. Reporting and Monitoring: Tools for monitoring credit exposure and managing risk.

7. What are the different types of billing processes available?

In SAP SD, billing processes handle various business scenarios, ensuring accurate billing aligned with sales and delivery processes. Types include:

• Standard Billing: Creates an invoice from a sales order or delivery document.
• Collective Billing: Consolidates multiple deliveries or orders into one invoice.
• Invoice Correction Request: Corrects errors in issued invoices.
• Pro Forma Billing: Non-binding invoice for informational purposes.
• Periodic Billing: Regular billing at specified intervals.
• Milestone Billing: Billing at predefined project milestones.
• Intercompany Billing: For transactions between company codes within the same organization.

8. Explain the process of configuring a new shipping point.

Configuring a new shipping point in SAP SD involves:

• Define Shipping Point: Specify the shipping point’s details.
• Assign Shipping Point to Plant: Link the shipping point to the relevant plant.
• Configure Shipping Conditions: Align with business requirements.
• Set Up Transportation Zones and Routes: Determine delivery paths.
• Maintain Shipping Point Determination: Set rules for shipping point selection.

9. What is the role of partner functions?

In SAP SD, partner functions define the roles of business partners in a sales transaction. Standard functions include:

• Sold-to Party (SP): Customer placing the order.
• Ship-to Party (SH): Entity receiving the goods.
• Bill-to Party (BP): Entity receiving the invoice.
• Payer (PY): Entity responsible for payment.

Partner functions are assigned to a partner determination procedure, ensuring correct partners are populated in sales documents.

10. Explain the process of intercompany sales and how it is configured.

Intercompany sales in SAP SD involve transactions between company codes within the same group. The process includes:

• Sales order creation in the selling company code.
• Automatic purchase order creation in the buying company code.
• Delivery and billing in both company codes.
• Intercompany billing for transaction settlement.

Configuration steps include:

• Organizational Structure: Define company codes and sales areas.
• Customer and Vendor Master Data: Create records for both company codes.
• Intercompany Pricing: Set up transfer pricing conditions.
• Billing Configuration: Configure billing types and document types.
• Account Determination: Define settings for financial postings.

11. Explain the integration points between SD and other modules like MM and FI.

The SAP SD module integrates with other modules like MM and FI for seamless business processes.

Integration with MM:

• SD integrates with MM for availability checks, transfer of requirements, and stock movements.
• During delivery, goods issue is posted in MM, updating inventory levels.

Integration with FI:

• SD integrates with FI for billing and revenue recognition, generating accounting documents for revenue and accounts receivable.
• Ensures accurate financial transactions in the general ledger.

12. What are the different types of sales documents?

In SAP SD, sales documents manage sales processes. Types include:

• Inquiry: Customer request for product information.
• Quotation: Formal offer detailing prices and terms.
• Sales Order: Document specifying products, quantities, and prices.
• Contract: Agreement for product supply over time.
• Scheduling Agreement: Long-term delivery schedule agreement.
• Credit Memo Request: Request for credit memo issuance.
• Debit Memo Request: Request for debit memo issuance.
• Returns: Document for product returns.

13. Describe the output determination process.

The output determination process in SAP SD involves:

• Condition Technique: Core mechanism using condition tables, access sequences, condition types, and output determination procedures.
• Condition Tables: Store data for output determination.
• Access Sequences: Search strategy for condition records.
• Condition Types: Specific output types like order confirmation or invoice.
• Output Determination Procedures: Define relevant condition types for documents.
• Partner Functions: Determine output recipients.
• Medium and Timing: Outputs in various formats and times.

14. Explain route determination and its importance.

Route determination in SAP SD identifies the most efficient delivery path. It considers:

• Shipping Point: Dispatch location.
• Destination: Delivery location.
• Transportation Group: Material classification for transportation.
• Shipping Conditions: Delivery conditions.

Configuration involves defining routes, assigning transportation zones, and setting up schedules.

15. Describe the process of revenue account determination.

Revenue account determination in SAP SD ensures correct revenue account postings during billing. It involves:

• Condition Technique: Uses condition tables, access sequences, and condition types.
• Account Determination Procedure: Assigned to billing document type.
• Access Sequence: Search order for condition records.
• Condition Tables: Link sales data to revenue accounts.
• Account Keys: Differentiate revenue types.
• Chart of Accounts and Account Assignment: Determine specific revenue accounts.

The process involves checking the account determination procedure, searching for condition records, and determining revenue accounts.