168 SAP MM Q UESTIONS AND A NSWERS the company physically counts inventory. It is required in financial accounting rules or for placing an accurate value on the inventory for tax purposes. 4. What are the initial configuration steps for purchase acquisition? The steps for purchase acquisition are as follows: Defi the default values for the physical inventory ning document Reporting batch inputs Recording tolerances for physical inventory differences Inventory sampling as well as configuration of cycle counting 5. What is the difference between managing stock by quantity and managing stock by value? Transactions that make changes in the stock result in stock updates that are recorded in real time. At any point in time one can view the stock overview, which represents the current situation at that time. That is the essence of stock management by quantity, and can applied to the following stock types: Located in the warehouse Ordered but not yet received Located in the warehouse and reserved for a particular purpose Reserved for quality inspection The managing stock by value option reviews the stock materi- als qualitatively rather than quantitatively. The valuation of stock is done either at the plant level or at the location level. Updates that can be done when managing stock by value are as follows: