Financial Accounting (FI) with SAP ERP 6.0 - Application Associate Certification Exam Questions

Sample Questions Q1.  The organizational units of Financial Accounting are used for external reporting  purposes, that is, they fulfil requ...

Sample Questions
Q1. The organizational units of Financial Accounting are used for external reporting 
purposes, that is, they fulfil requirements that your business is subject to from external 
parties, for example, legal regulations.
Which of the following Organizational units are mandatory in an ERP system with FI?
(More than one answer is correct)

A.        Client
B.        Business Area
C.        Company code
D.        Company
Answer:A, C

You create your company-specific organizational structure in the SAP System by defining 
the organizational units and making the basic settings. Defining organizational units for 
Financial Accounting is obligatory, that is, you have to define these units in order to be 
able to implement the Financial Accounting component.

Organizational unit        DefinitionClient                                  ObligatoryCompany                           OptionalCompany code                 ObligatoryBusiness area                  Optional

Apart from this, there are certain Basic settings that are mandatory as well. These are:

Chart of accounts

Fiscal year


Q2. You can configure different types of Chart of Accounts in the ERP system. Some of 
these are:

A. Operating chart of accounts

B. Group chart of accounts

C. Country-specific chart of accounts

D. Plant specific chart of accounts

Answer:A, B, C

Charts of accounts can have three different functions in the system:
•        Operating chart of accountsThe operating chart of accounts contains the G/L accounts that you use for posting in your 
company code during daily activities. Financial Accounting and Controlling both use this 
chart of accounts.
You have to assign an operating chart of accounts to a company code.
•        Group chart of accountsThe group chart of accounts contains the G/L accounts that are used by the entire 
corporate group. This allows the company to provide reports for the entire corporate 
The assigning of an corporate group chart of accounts to a company code is optional.
•        Country-specific chart of accountsThe country-specific chart of accounts contains the G/L accounts needed to meet the 
country's legal requirements. This allows you to provide statements for the country's legal 
The assigning of an country-specific chart of accounts to a company code is optional.

Q3. The company code, business area and controlling area organizational units can be 
combined in a number of ways. Using these combinations you can represent 
organizations with different structures. Which of the following are valid combinations?

A. One Company Code can be assigned to multiple Controlling areas

B. One Controlling area can be assigned to multiple company codes

C. One business area can be assigned to multiple company codes

D. One company code can be assigned to multiple business areas
Answer:B, C, D

•        One Controlling Area is Assigned to One Company Code
In this example, the financial accounting and cost accounting views of the organization are 

•        Multiple Company Codes Assigned to One Controlling Area
This example is Cross-Company Code Cost Accounting. Cost accounting is carried out 
in multiple company codes in one controlling area. All cost-accounting relevant data is 
collected in one controlling area and can be used for allocations and evaluations. In this 
case, the external and internal accounting perspectives differ from each other.
For example, this method can be used if the organization contains a number of 
independent subsidiaries using global managerial accounting. Cross-company code cost 
accounting gives you the advantage of using internal allocations across company code 

Company Codes and Business areas have an n:m relationship

Q4.  You need to assign more than one company code to one controlling area. Under 
what kind of a business scenario would you need to consider such a decision?

A. Cross-company code transactions that MUST be processed in a controlling area

B. Multilevel Product Cost Management across company codes

C. Representation of intercompany processes, whereby producing and delivering plant 
are the same.
Answer:A, B

A 1:n relationship between controlling area and company code is recommended for the 
following situations:

•        Cross-company code transactions that MUST be processed in a controlling area, 
for example, production in an associate plant, special cases of intercompany processing.

•        Cross-company code CO postings that can be displayed in the reconciliation 
ledger, such as assessments, capitalization of internal activity in Asset Accounting, 
activity allocation.

•        Representation of group costing.

•        Use of Profit Center Accounting and transfer prices.

•        Multilevel Product Cost Management across company codes

A 1:1 relationship between controlling area and company code is recommended for the 
following situations:

•        Consolidated analysis of settled transactions across company codes in Profitability 
Analysis (CO-PA) In this situation, you assign more than one controlling area to an 
operating concern

•        Representation of intercompany processes, whereby producing and delivering plant 
are the same.

Q5.  Which of the following tax types does the SAP System support for calculating, 
posting, and correcting tax, as well as for tax reporting?

A. Tax on sales & purchases
B. Withholding Tax
C. Top Up Tax
D. Additional Tax
Answer:A, B, D

The following Tax types are supported in a standard SAP system:
Tax on sales and purchasesTaxes on sales and purchases are levied on every sales transaction in accordance with 
the principles of VAT. This applies to input and output tax, for example.
Input tax is calculated using the net invoice amount and is charged by the vendor.
Output tax is calculated using the net price of products and is charged to the customer.
Companies can offset input tax against output tax, paying the balance to the tax 
authorities. Tax authorities can set a nondeductible portion for input tax which cannot then 
be claimed from the tax authorities.
Additional taxAdditional taxes are taxes that are posted in addition to tax on sales/purchases. They are 
usually country-specific, such as investment tax in Norway, or sales equalization tax in 
Sales taxAn example of sales tax is the sales and use tax that exists in the USA. Sales 
transactions that are taxed must be kept strictly separate from sales transactions that are 
not taxed.
In general, goods that are intended for production or for resale to a third party are 
procured untaxed; that is, the vendor does not calculate tax on the sale of these goods 
(sales tax). Procurement transactions for individual consumption, on the other hand, are 
taxable (use tax).
The principle of sales tax does not permit the option of offsetting input tax against output 
tax. The vendor must pay the taxes to the tax authorities.
The system calculates sales tax based on material and customer location and posts it in 
Sales and Distribution (SD) and Materials Management (MM). If customers or vendors 
are exempt from taxation, you can specify this in their master records by entering the 
appropriate indicator.
Withholding taxIn some countries, a portion of the invoice amount must be withheld for certain vendors 
and paid or reported directly to the tax authorities.
SAP currently provides two functions for calculating withholding tax: Classic withholding 
tax and extended withholding tax.

Extended withholding tax includes all the features of classic withholding tax and, in 
addition, also fulfills a number of further country-specific requirements.
If you wish to implement the withholding tax functions, you should choose extended 
withholding tax.

Q6. Depending on your system’s configuration, the system can generate and post line 
items automatically. For which business transactions can this be done?

A. Entering a customer invoice
B. Entering Special G/L transactions
C. Posting a Vendor Payment
Answer:A, B, C

The following line items are generated for each of the above business transactions:
Entering a customer or vendor invoice   •        Tax on sales/purchases (output tax when posting a customer invoice, input tax when 
posting a vendor invoice)
•        Payables and receivables between company codes (when posting cross-company 
code transactions)
Posting a customer or vendor payment and clearing open items      
•        Cash discount (paid and received when posting payments)
•        Backdated tax calculation for tax on sales/purchases (after cash discount deduction)
•        Gains and losses from exchange rate differences (between invoice and payment)
•        Unauthorized deduction of cash discount (when a payment is slightly different to the 
amount due)
•        Residual items
•        Bank charges
Entering special G/L transactions      
•        Bill of exchange charges
•        Tax adjustment for a down payment

Q7. You can add details to any automatically generated line item. For example, you can 
add text to a tax on sales/purchases line item.

A. True
B. False

If you are permitted  to make additional account assignments to the automatically 
generated line items, the system branches directly to the document overview. Here, the 
automatically generated items are highlighted.

To enable this, you need to make sure that the G/L account is marked as adjustable and 
that the appropriate field is defined as optional or required in the field status group.

Q8. The document type is a key that is used to classify accounting documents. It is 
entered in the document header and applies to the whole document.
Which of the following purposes are achieved by using document types?

A. Assigning document numbers
B. Posting to account types
C. Clearing line items
D. Differentiating between business transactions
Answer:A, B, D

The following purposes are served by using 'Document Types:

Differentiating between business transactions. The document type tells you 
instantly what sort of business transaction is in question. This is useful, for example, when 
displaying line items for an account.

   Controlling the posting to account types (vendor, customer, or G/L 
. The document type determines which account types that particular document 
can be posted to.
•        Assigning document numbers. A number range is assigned to every document 
type. The numbers for the documents you create are taken from this number range. The 
original documents from one number range should be stored together. In this way, the 
document type controls document storage.
For more information, see Document Number Assignment and Controlling Document 
Storage Using the Document Type
•        Applying the vendor net procedure. This means that any discount and the net 
amount are calculated (and posted) when the vendor invoice is posted.

Q9. If you have entered an incorrect document, you can reverse it, thereby also clearing 
the open items. With reference to 'document reversal', which of the following are true?

A. A document can be reversed if it has no cleared items
B. Documents in MM can be reversed with a credit memo
C. If the posting period of the source document has already been closed, you have to 
enter a date that falls in an open posting period (for example, the current one) in the 
Posting date field.
Answer:A, C

A document can only be reversed if:
●      It contains no cleared items
●      It contains only customer, vendor, and G/L account items
●      It was posted with Financial Accounting
●      All entered values (such as business area, cost center, and tax code) are still valid

If a line item from a source document has been cleared, a reversal can only be carried out 
after the clearing is reset. Information on clearing is available in FI General Ledger 
Accounting as well as FI Accounts Receivable and Accounts Payable.

Documents from SD can be reversed with a credit memo.

Documents from MM must be reversed with functions in that component because the 
reversal function in FI does not reverse all the values required.

There are two ways of updating transaction figures when reversing a document:
●      The document and the reverse document increase the account transaction debit and 
credit figures by the same amount.
●      After a document has been reversed, the balance of the account affected is shown 
as if the document had never been posted. (Negative Postings)

You generally post the reversal document in the same posting period as the 
corresponding original document. If the posting period of the source document has 
already been closed, you have to enter a date that falls in an open posting period (for 
example, the current one) in the Posting date field.

Q10. A number of periodic tasks are executed on a regular basis (daily, weekly, or 
monthly) in the SAP System. This process is supported by the individual components of 
the Schedule Manager. Which of the following are components of the Schedule Manager?

A. Flow definition
B. Scheduler
C. Monitor
D. Exception area
Answer:A, B, C

The following are the key components of schedule manager:
Flow definitionIn a flow definition, you can link tasks to each other if they are related or if you wish to use 
a worklist in them. You can therefore schedule a flow definition as a task in the scheduler.
SchedulerIn the scheduler, you can schedule tasks in a structure tree. You can use drag-and-drop in 
a daily overview to enable the system to execute the tasks at a certain time.
MonitorThe monitor gives you an overview of the scheduled tasks during and after processing. 
You can correct faulty objects in a worklist.
WorklistObjects that are to be processed in a processing step sequence are managed in the 
The worklist monitor presents information such as which objects were processed without 
errors and which objects could not be processed. You can display information on the 
cause of errors, and thus control the way in which the object is processed further.
The worklist ensures that when a processing step sequence is processed again, the 
system only processes the objects which had errors or which you manually instructed the 
system to reprocess.

Q11. You would like to use recurring entries for periodic transaction. Which of the 
following are False with reference to 'recurring entries'?

A. Posting Key, Account and Amount never change in recurring entries
B. Postings can be made periodically or on a specific date
C. Recurring documents do Not require a separate number range.
Recurring entries are business transactions that are repeated regularly, such as rent or 
insurance. The following data never changes in recurring entries:
•        Posting key
•        Account
•        Amounts
You enter this recurring data in a recurring entry original document. This document does 
not update the transaction figures. The recurring entry program uses it as a basis for 
creating accounting documents.
The system uses the recurring entry original document that you enter as a reference. It is 
not an accounting document and therefore does not affect the account balance.
In the recurring entry document, you define when a posting is to be created with this 
document. You have two options for scheduling. Postings can be made periodically or on 
a specific date:
•        For periodic postings, specify the first and last day of execution, as well as the 
interval in months.
•        If you want to specify certain dates, enter a run schedule in the recurring entry 
original document. Store the required dates in the Implementation Guide (IMG). Choose 
Financial Accounting Global Settings  Document  Recurring Entries  Define Run 
Schedules/Enter Run Dates.

To post recurring entry documents, you have to set up a separate number range for the 
company codes that use them. You have to use key X1 for the number range. The system 
takes numbers for the recurring entry original document from this number range.

Q12. You are responsible for 'dunning' configuration. Which of the following are part of 
configuring the dunning functionality?

A. Dunning Codes
B. Dunning Items
C. Dunning areas

The dunning configuration consists of configuring the following:
•        Dunning procedureThe dunning procedure controls how dunning is carried out by the system. You can define 
as many dunning procedures as you like.
•        Dunning levelThe dunning levels are calculated based on the number of days open items are in arrears. 
You can also have the system calculate the dunning levels based on the dunning amount 
or a percentage paid (sales-related dunning level determination).
You can determine more than one dunning level per dunning procedure.
•        Dunning areasA dunning area is an organizational unit within a company code used for the dunning 
A dunning area can be a division or a sales organization. You assign a dunning area to 
an open item when you are posting. You can dun items separately by dunning area.

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