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Review Questions 263

It is divided into one or more storage types. A storage type is a division of
a warehouse based on the characteristics of the space, materials, or activity
needed, such as shelf storage, pallet storage, or hazardous storage. Storage
types can be further divided into storage sections, which are logical groupings
of materials based on similar characteristics, such as weight, size, or activity.
Within each storage section, materials are grouped into storage bins, which is
where the actual materials are stored and are the smallest logical unit of stor-
age that can be managed in WM. Each storage bin has a unique address which
identifi es it, typically based on a coordinate system.
Warehouse management is tightly integrated with the procurement, ful-
fi llment, and production processes and can provide companies with a great
deal of accuracy when managing large inventories of materials. There are multi-
ple reporting options to view inventory status and activities across warehouses
and plants from high-level activities to bin-level quantities.

KEY TERMS

Company code-to-company code Stock transport order (STO)
transfer
Storage bins
End value
Storage location-to-storage
Inventory and warehouse location transfer
management (IWM)
Storage type
Inventory management (IM)
Transfer order (TO)
Increment
Transfer requirement (TR)
Interim storage areas
Warehouse
Picking area
Warehouse management
Plant-to-plant transfer view

Posting change notice Warehouse management (WM)
Quant

REVIEW QUESTIONS

1. Identify and discuss the key organizational levels relevant to inventory
management and warehouse management.

2. Discuss the key master data relevant to warehouse management.
3. Defi ne the four types of goods movements in IM, and provide an example
of each type.

4. Explain the material and fi nancial accounting impacts of goods movements
in IM.

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