Oracle E-Business Suite R12 Project Essentials Exam v6.0 (1z0-511)

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Total 77 questions

Identify the correct setup to Integrate Project costing with Oracle Inventory.

  • A. In Oracle Inventory, enable Project Cost Collection for each organization. In Oracle Projects, define an expenditure type with class "Inventory." Define the project related transaction source in Oracle Inventory.
  • B. Set up Oracle Project Manufacturing. In Oracle Projects, define an expenditure type with class "Inventory." Define the project-relatedtransaction source in Oracle Inventory.
  • C. In Oracle Inventory, enable Project Cost Collection for each organization. In Oracle Projects, define an expenditure type with class "Inventory." Define the project-related transaction type in Oracle Inventory.
  • D. Oracle Project Manufacturing must be set up. In Oracle Inventory, enable Project Cost Collection for each organization. Define the project-related transaction source inOracle Inventory

Answer : C

*Integrating Projects with Inventory without Project ManufacturingYou can implement
Inventory to Projects integration so that you can issue from inventory to projects without installing Project Manufacturing. To implement this integration, follow these steps:
-> Enable Project Cost Collection. In the Organization Parameters window in Oracle
Inventory, enable the Project Cost Collection Enabled box. See Defining Costing
Information,Oracle Inventory User's Guide.
-> Create a Project-Enabled Transaction Type.
-> Set the INV: Project Miscellaneous Transaction Expenditure Type Profile
Option. In Oracle Inventory, set the value of this profile option to User Entered.
With this setting, You must enter expenditure types for project miscellaneous transactions.
-> Create an Inventory Expenditure Type. In Oracle Projects, create an expenditure type with the transaction type class Inventory.
*Oracle Inventory Integration
The following stepsarerequired for Oracle Inventory integration:
-> Install and implement Oracle Inventory
-> Define project-related transaction types in Oracle Inventory
Oracle Projects Implementation Guide

A company requires advance payments for their contract projects. How would they ensure that for specific types of work they always have an advance payment?

  • A. Create a specific agreement type and use the advance receipts required extension toensure that theseagreements require advancepayments.
  • B. Set the customer profilein Accounts Receivable to require advance payments.
  • C. Createa transaction control for specificagreement types to ensure thatadvance paymentsare received.
  • D. Entera negative agreement value andfunded amount.
  • E. Fund the projects with a dummy agreement.

Answer : A

*You can set up an agreement to require advance payments by selecting the Advance
Required on the agreement. You can also use the Advance Required client extension to determine which agreements require advance payments. On these agreements, you can enter funding only up to the amount of advance payments.
The ability to change the Advance Required agreement option is controlled by function security.
*Agreements with Advance Payments
You can require advance payments on an agreement and record advance payments as they are made. When you generate draft invoices for projects that are funded by the agreement, the advance balance that is displayed on the funding summary is reduced. You then interface the invoice to Receivables. The AutoInvoice process in Oracle Receivables reduces the balance on the advance.

Your company wants to define all its equipments as Non-Labor resources to track the cost incurred on the usage of these equipments, when defining the equipment. When defining the equipment as a Non-Labor resource in the system, you need to assign an expenditure type to it. What kind of expenditure type to it. What kind of expenditure type can be assigned to a Non-Labor resource?

  • A. expenditure type defined withExpenditureType Class as Work in Process
  • B. expenditure type defined with ExpenditureType Class as Burden transactions
  • C. expenditure type defined withExpenditure Type Class as Supplier Invoices
  • D. expenditure type defined with Expenditure Type Class as Miscellaneous Transactions
  • E. expenditure type defined with Expenditure Type Class as Usages

Answer : D

Explanation: Oracle Projects uses the following expenditure type classes to process non- labor project costs:
*Usages - Asset usage costs are interfaced to Oracle General Ledger.
*Supplier Invoices - Oracle Payables supplier invoices are interfaced from Oracle Payables to Oracle Projects.
*Miscellaneous Transaction - Miscellaneous Transactions are used to track miscellaneous project costs. This expenditure type class is similar to usages. The difference is that, for miscellaneous transactions expenditure items, you are not required to specify a non-labor resource or a non-labor resource organization, as you are for usage expenditure items.
Miscellaneous transactions may be used for the following costs:

Fixed assets depreciation -

Allocations -

Interest charges -
*Burden Transaction - Burden transactions track burden costs that are calculated in an external system or calculated as separate, summarized transactions. These costs are created as a separate expenditure item that has a burdened cost amount, but has a quantity and raw cost value of zero. Burden transactions are interfaced to Oracle General
Ledger. As with any other transaction in Oracle Projects, you can adjust and capitalize burden transactions, or accrue revenue or generate invoices for these transactions.
*Work In Process - This expenditure type class is used for Project Manufacturing WIP transactions that are interfaced from Manufacturing to Oracle Projects. You can also use this expenditure type class when you import other manufacturing costs via Transaction
Import or when you enter transactions via pre-approved batch entry.
Reference:Expenditure Type Classes

A customer needs to enable all employees to enter timecards through the web against projects and tasks. What needs to be implemented to allow time to be recorded in

  • A. Project CostingOracleTime andLaborHuman Resources
  • B. OracleTime andLaborPayrollPurchasing
  • C. Project CostingProject ManufacturingHuman Resources
  • D. Projects Resource ManagementOracleTime and LaborHuman Resources
  • E. Project CostingOracle Time and LaborHuman ResourcesPayroll

Answer : E

* Payroll
*Time & Labor.
There are many reports within Oracle Time & Labor to gather data about timecards entered through self-service and to gather data about timecards that you have transferred to the professional forms timecard window.
Reference:Oracle Time and Labor Implementation and User Guide

A customer enables transaction controls at the Project level. Oracle Project Costing checks the control when the customer ________.

  • A. transfers an expenditure item to another task of the same project
  • B. runs the PRC: Distribute Labor Costs concurrent program
  • C. runsthe PRC: Transaction Import concurrent program
  • D. entersaproject-related invoice distributionin Oracle Payables
  • E. enters an online or preapproved expenditureitem

Answer : E

Explanation: Expenditure Item Validation
When you enter expenditure items, you are charging cost to a project and a task. Oracle
Projects validates expenditure items against predefined criteria and any transaction controls and transaction control client extensions that you set up during the implementation.
Reference:Oracle Project Costing User Guide

Which three statements are true about Multi-Currency Billing?

  • A. Agreements, Events, and Bill Rates have to be in the same current as the Project Functional Currency.
  • B. Agreements,Events, and Bill Rates can all be different currencies than the ProjectFunctionalCurrency.
  • C. The Project Currency can be different from theFunctional Currency of the operating unitthat owns the project.
  • D. The ProjectCurrency has tobe the same as the Functional Currency of the operating unit that owns the project.
  • E. An agreementcan fund invoices in more than one currency.

Answer : B,C,E

Explanation: C:The multi-currency billing option can be set both at the operating unit level and at the project level. To enter agreements and rate schedules in any currency for a project, you must enable the multi-currency billing functionality for the operating unit. To enter events in any currency for a project, you can enable the functionality at the project level only. This value defaults from the project template You can override the default value for an individual project template or project.
Oracle Projects gives you the option to bill in a global environment when the multi-currency billing is enabled for an operating unit and for a project. When multi-currency billing is enabled, you can:
*Enter agreements, bill rates, and events in any currency regardless of the project functional currency(B)
*Designate the project functional currency, project currency, or funding currency as the invoice processing currency for a project
*Designate the project functional currency and the invoice transaction currency as the revenue transaction currency
*Define currency conversion attributes for converting revenue and invoicing amounts to the project currency, project functional currency, and funding currency
*Define currency conversion attributes for converting funding amounts to the project functional currency, and the project currency
*Define a default invoice currency for a project customer that is different from the project functional currency and assign conversion attributes for deriving revenue in this currency
Reference:Oracle Project Billing User Guide

Your company has two separate expenditure types to capture straight time and overtime labor transactions across all projects. When running cost distribution for labor transactions, the straight time labor must be charged to a labor expense account and overtime labor costs to an overhead expense account. How would you set up two different expense accounts?

  • A. Set up the account at theExpendituretype definition.
  • B. Define an AutoAccounting rule to derive account based on expenditure and attach it the AutoAccounting function "Labor Cost Account."
  • C. Define an AutoAccounting rule to derive account based on expenditure and attach it the AutoAccounting function "Labor Cost Clearing Account."
  • D. Set up the account at the Expenditure type usage definition.
  • E. Set up the account at the Labor costing rule definition.

Answer : B

Explanation: Implement AutoAccounting to charge appropriate expense accounts
When you implement AutoAccounting, you can charge straight time costs to a labor expense account and overtime costs to an overhead or overtime expense account.
To charge straight time and overtime to different accounts, you define an AutoAccounting rule based on expenditure type, expenditure category, service type, compensation rule, or labor cost multiplier.
*Labor Cost Account Function
When you run the PRC: Distribute Labor Costs process, Oracle Projects calculates labor cost amounts based upon employee labor cost rates and compensation rules. After calculating labor costs, Oracle Projects uses the Labor Cost Account transactions to debit an expense account for raw labor costs.
*You need to define at least one overtime expenditure type. You use the Expenditure
Types window to define overtime expenditure types classified by the Overtime expenditure type class.

You implement Project Manufacturing along with Project Costing for manufacturing company. You define various expenditure types in which few are specific to Project
Manufacturing. Identify the three setups that are required to have an expenditure type specific to Project Manufacturing.

  • A. Rate Required is enabled for theExpenditureType.
  • B. "Work In Process" class is associated with the Expenditure Type.
  • C. "Miscellaneous transactions" classis associated with the Expenditure Type.
  • D. "Inventory" class is associated with the ExpenditureType.
  • E. Rate Required Is not enabled for the Expenditure Type.

Answer : A,B,D

Explanation: B:Work In Process - This expenditure type class is used for Project
Manufacturing WIP transactions that are interfaced from Manufacturing to Oracle Projects.
You can also use this expenditure type class when you import other manufacturing costs via Transaction Import or when you enter transactions via pre-approved batch entry.
D:Inventory - This expenditure type class is used for the following transactions:
Project Manufacturing transactions that are interfaced from Manufacturing or Inventory to
Oracle Projects.
Oracle Inventory Issues and Receipts that are interfaced from Oracle Inventory to Oracle
Projects in a manufacturing or non-manufacturing installation.
You can also use this expenditure type class when you import other manufacturing costs via Transaction Import or when you enter transactions via pre-approved batch entry.
option for the selected expenditure type is enabled in Oracle Projects, then you must enter a quantity. When you interface the invoice distribution toOracle
Projects, Oracle Projects copies the quantity and amount to the expenditure item and option for the selected expenditure type is disabled, then the quantity of the expenditure item is set to the amount you enter in Oracle Payables.

Which three options would result in a billing event being excluded from an invoice?

  • A. No taskisassigned to the event.
  • B. No event date has been entered.
  • C. The event dateis later than the invoice date when the process for draftinvoicegeneration issubmitted.
  • D. The event has been placed on hold.
  • E. No revenue amount has been entered on the event.

Answer : B,C,E

*Events: To be included on an invoice, an event must meet the following criteria:
/Event must not be already invoiced
/ (C)Event completion date must be on or before the bill through date
/Event must be revenue distributed (for write-on revenue events only)
/If the Date-Effective Funds Consumption option is selected, then the event date must be within the agreement start and expiration dates
*Billing Events: Billing events are events for which there is no associated revenue. Because billing events have not accrued revenue against an agreement, a billing event can be billed against any agreement that has sufficient funding to cover the entire amount of the event
(unless an agreement was specified on the event).
Reference:Oracle Project Billing User Guide, Invoicing

In a manufacturing company, there is a need to define 50 different jobs for engineers in
Human Resources. For those 50 jobs, Oracle Projects has only 20 equivalent jobs for
What functionality do you use to link these Human Resources and Projects jobs?

  • A. Job Groups
  • B. Job Families
  • C. Job Mapping
  • D. JobLevels
  • E. Job Hierarchy

Answer : A

Explanation: Organizations within your enterprise are not required to use the same job definitions. You can define job groups for specific purposes and define unique jobs for each group. You can then map a job from one group to a job in another group. For example, the job titles you need for your European operating units may be different from the job titles you need for your U.S. operating units. For global projects you can define a global job set and map your European and U.S. jobs to the appropriate global jobs. These global jobs can then be used by your global projects to provide accurate and consistent billing and reporting.
Reference:Oracle Projects Fundamentals,Jobs Overview

You have set up a capital projects "Building Construction" with task "Block A." Which method should be used to capitalize the transactions charged to "Block A" with the expenditure type "Construction Costs" and expense the transactions charged to "Block A" with the expenditure type "Overheads"?

  • A. In the Expenditure type setup, mark"Overheads"as Non-capitalizable.
  • B. Set up transaction controls at the"Block A"task to make"Overheads"Non-capitalizabale.
  • C. Define the"Block A"task as Non-capitalizable.
  • D. Exclude"Overheads"from Capitalization in Asset assignments.
  • E. Use Asset Lines Processing Extension.

Answer : B

Explanation: Capitalizable to Non-Capitalizable or Non-Capitalizable to Capitalizable
You can mark a capitalizable expenditure item as non-capitalizable, or vice versa. A capitalizable item can be grouped into an asset line you send to Oracle Assets. A non- capitalizable item cannot become an asset cost in Oracle Assets.
You can define tasks as capitalizable or non-capitalizable; you can further specify which items are non-capitalizable using transaction controls.
Reference:Types of Expenditure Item Adjustments

A company has different organization requirements for HR, Payroll, Finance, and Projects.
How can the company achieve this?

  • A. Byconfiguring a shared organization hierarchy
  • B. By configuring separate organization hierarchies for each application
  • C. By configuring a shared organization hierarchy forProjects and Payroll
  • D. By configuringashared organization hierarchy for Finance and Payroll

Answer : C

*Organization hierarchies provide a structure for the relationships between the organizations within your enterprise. They enable you to manage expenditure and reporting data and coordinate project-owning organizations. If your organization uses business groups, you can create project burdening organization hierarchies for each business group.
You define an organization hierarchy by telling Oracle Projects which organizations are subordinate to which other organizations. You can define one organization hierarchy or several, depending on the needs of your enterprise.
*The organizations and organization hierarchies of an enterprise are closely interrelated with the policies and procedures of that enterprise. To configure Oracle Projects to meet your business requirements, you must make critical implementation decisions regarding how you set up your organizations in Oracle Projects.
Organizations are departments, sections, divisions, companies, or other organizational units in your enterprise. You can gather collections of organizations into organization hierarchies. Organization hierarchies make it easier to manage expenditure and reporting data and coordinate the project-owning organizations within your enterprise.

A project manager wants to create a revenue budget based on the project agreement and allocated funding. How can this be achieved?

  • A. by manually creatingarevenue budget
  • B. by selecting Funding revaluation in the systemimplementation options.
  • C. by selecting the "baseline project without budget" option, which will createa revenue budgetautomatically based on project funding
  • D. by selecting Invoiceat top taskfor the project
  • E. by setting transaction controls

Answer : C

Explanation: You can automatically create and baseline an Approved Revenue Budget for a project by checking the Baseline Funding without Budget check box in the Project
Funding Inquiry window.
Note:Budget/Fund/Bill at Project or Top Task Level
You can create a revenue budget, funding source allocation and project agreement, and perform billing at either the project or the top task level. After you have created an allocation line at either level, you cannot change to another level. For example, if you have created a funding allocation for a top task, you cannot create another funding allocation for the same project without entering a top task.
Reference:Oracle Project Contracts Implementation Guide

A company is using Project Billing. To meet their billing requirements, the company has
Set up various revenue categories. Identify four places where the company can use these revenue categories in Oracle Project.

  • A. Setting upTransaction Controls using Revenue Categories.
  • B. GroupingExpenditureTypes by RevenueCategories.
  • C. GroupingEventTypeRevenue Categories.
  • D. Defining Rate Schedules using Revenue Categories.
  • E. Setting up AutoAccountingRules using Revenue Categories.
  • F. EnteringBudgets using RevenueCategories.

Answer : B,C,E,F

Explanation: Revenue categories are used for grouping expenditure types(B)and event types(C)for revenue and billing
You can use revenue categories for budgeting(F), for reporting purposes, and in your
AutoAccounting rules(E). Revenue Categories are also used for grouping expenditure types for revenue and billing(B).
*A revenue category describes a source of your organization's revenue. For example, a revenue category with a name such as Labor refers to labor revenue.

Reference:Revenue Categories -

A project has been mistakenly set up as a capital project, instead of a contract project. The project has already incurred expenditure. How can this be remedied?

  • A. Change the project type to Contract
  • B. Leave the project as capital and accruefor revenueasis.
  • C. Move all the costs toan contract task within the capital project.
  • D. A new project should be set up and costs transferred.
  • E. Delete all the expenditure Items and change the project type.

Answer : D

*Project Type
The project type determines how Oracle Projects processes costs (expenditure items) for a project. The type you choose provides many defaults and controls for project entry and processing. You must choose a type from one of the following project type classes:
/Use an Indirect project type to collect and track expenditure item costs and labor hours for overhead activities, such as administrative and overhead work, marketing, and bid & proposal preparation. You can also define indirect projects to track time off including sick leave, vacation, and holidays
/Use a Capital project type to collect and track costs and labor hours for asset development activities which you plan to capitalize as one or more assets.
/Use a Contract project type to collect and track costs, labor hours, revenue, and billing for services performed for and reimbursed by a client

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Total 77 questions